Strengthening the accuracy and visibility of supply chain management data in the coffee industry

Abstract

The visibility and accuracy of information have emerged as two vital factors in global supply chains, because of the inadequacy of real-time data throughout the coffee supply chain in Indonesia. This study aims to create a development model that enhances visibility and information accuracy throughout the supply chain of Indonesia Coffee, having the intention of boosting performance. To analyze and describe the informed perceptions and social dynamics along Indonesia’s coffee supply chain, explanatory qualitative research utilized descriptive data. This study involved exploring and developing basic assumptions, collecting, and validating data through focus group discussions, and modeling the data through reduction, categorization, analysis, and interpretation. The study identified three key factors that contribute to improving the visibility and accuracy of information in the coffee supply chain: smart operations, security systems, and platform collaborations. These factors are implemented through three types of information and product flows, which serve as channels for delivering value.

Keywords:

• Information
• SMART operations
• security systems
• platforms collaboration 

REVIEWING EDITOR:

• Etayankara Muralidharan, MacEwan University, Canada

SUBJECTS:

• Business, Management and Accounting
• Production, Operations & Information Management
• Management of Technology & Innovation

Research background

Data sharing is critical to supply chain effectiveness, but it is very difficult and time-consuming when using manual systems, and accuracy is a key to it (Huo, 2012; Tan et al., 2023). Thus, visibility and accuracy of information have become two priority aspects of global supply chains (Morgan & Sisak, 2016; Somapa et al., 2018). This problem is exacerbated by the absence of a global-scale real-time platform that can cover the entire region (Bergh et al., 2019; Oanţă, 2020). The information invisibility also has an impact on the company’s inability to manage its inbound supply chain network (Thiruchelvam et al., 2018), which causes an increase in inventory, and leads to a waste of time and money.

In reality, most of the data along the coffee supply chain in Indonesia, whether collected manually, by barcodes, or by tags, are not in real-time (Azis et al., 2022). Data in the supply chain unit is obtained from different people, at different times of the day, and comes from various places, such as sales, warehouses, production sites, distribution facilities, and others (Eagle & Greene, 2014; Shanker et al., 2022). The data is then entered into a computerized database at certain times periodically. As a result, between these periods, which may usually last from a few hours to a few days, thus the underlying data formed is only pseudo-time. This becomes a visibility gap in the coffee supply chain system (Umaran et al., 2022). Unfortunately, in many cases, this data is used as a reference for other units or parties in the supply chain for various purposes, without any confidence in the accuracy of the data, and resulting in un-optimal decisions (Azis et al., 2022; Bashiri et al., 2021; Irjayanti et al., 2016; Thiruchelvam et al., 2018).

The mentioned elements serve as the foundation for emphasizing the necessity of the research being conducted, as they reveal an absence in the existing literature that must be addressed through this study. An analysis of the literature indicates that while the significance of visibility in supply chains has been acknowledged, there is still a requirement to gain a deeper comprehension of how enhanced visibility can result in improved efficiency in inventory management (Azis et al., 2022; Bashiri et al., 2021). Furthermore, it would be beneficial to delve deeper into many perspectives that might offer valuable insights in this study. The study can investigate the impact of enhanced visibility in the supply chain on improving inventory management efficiency. This can be achieved by utilizing advanced information technology or through integrating supply chain information systems more effectively (Thiruchelvam et al., 2018).

Furthermore, assertions on visibility for effective supply chain management are overly general. Hence, this study will concentrate on a more precise aspect of drives, specifically examining how enhancing visibility can enhance the effectiveness of inventory management. This will enable a more accurate delineation in the framework of research findings and facilitate debates that offer improved inputs to the current body of literature. Therefore, this research is well-grounded as it identifies gaps in the existing literature and presents potential perspectives requiring additional investigation. This will assist in formulating precise study inquiries that can address these gaps and provide a significant contribution to the comprehension of supply chain management.

Furthermore, the most significant challenge to achieving information accuracy is to address the extent to which visibility benefits without eliminating the potential for systematic data filtering (Behzadi et al., 2018; Eagle & Greene, 2014; Irjayanti & Azis, 2017) to effectively disseminate relevant information. This leads to efforts of reducing costs, improving service levels, and expected return on investment across the supply chain. To achieve real-time information visibility, it is necessary to acquire data automatically in real-time with instant access to the information needed, as well as convert the capabilities of the data obtained using high-security standards into relevant information (Azis et al., 2022; Ivanov et al., 2021; Tan et al., 2023). Thus, this study aims to generate a development model to increase the performance of visibility and information accuracy along Coffee’s Supply Chain in particular area in Indonesia.

Literature review

The rationale of supply chain management is to remove barriers among trading partners to synchronize information between them (Li et al., 2017). Effective supply chain management enables parties to coordinate and integrate the flows of goods, financials, and information in their supply chain systems (Saleem et al., 2021; Somapa et al., 2018; Tan et al., 2023; Thiruchelvam et al., 2018). Literature defines supply chains with various approaches but with similar discourses. The early definition states that supply chain management is concerned with the flow of materials and information through a series of interrelated activities: to plan, coordinate, and control materials, parts, and finished goods from suppliers to customers (Haudi et al., 2022; Heizer et al., 2016; Somapa et al., 2018). If supply chain practices run efficiently, the movement of goods and information will result in the lowest costs with a short distribution chain (Thiruchelvam et al., 2018).

Thus, the goal of supply chain management is to meet customer needs for low-cost products with minimal lead-time (Thiruchelvam et al., 2018; Umaran et al., 2022). This effort is carried out through increasing responsiveness, understanding consumer needs, overseeing the production process, and aligning the goals of all partners along the supply chain. This can be achieved by identifying key activities in supply chain practices (Maskey et al., 2020), which requires visibility throughout the chain and accurate information along the supply chain (Azis et al., 2022).

In addition, companies must be flexible enough to be able to make adjustments, rebuild, and optimize plans in real-time, and be able to anticipate unexpected events in the supply chain, as well as integrations that have an impact on good business performance (Kuzubov et al., 2018). Thus, supply chain management requires responsive decision support tools to determine optimal and feasible methods to meet customer demand and the efficiency of product supply through the visibility and accuracy of integrated information (Azis et al., 2022; Somapa et al., 2018; Tan et al., 2023). Visibility refers to the extent to which information is seen and communicated among supply chain members, regularly and collaboratively as a unit so that there is no misperception of available information (Somapa et al., 2018).

Visibility, in the context of supply chain management in the coffee business, refers to the capacity to systematically track and observe all activities and processes involved in the coffee bean’s path from its source to its final delivery to the consumer (Azis et al., 2022; Somapa et al., 2018; Tan et al., 2023; Thiruchelvam et al., 2018). Improved visibility enables stakeholders to quickly access important data like inventory levels, shipping status, and production schedules. This level of openness facilitates the identification of any disruptions, the optimization of operations, and the enhancement of coordination among suppliers, manufacturers, and retailers, thus guaranteeing a seamless and effective supply chain.

Accuracy relates to the exactness and dependability of the data and information that is exchanged across the supply chain (Azis et al., 2022). Precision in the coffee industry guarantees that the volume, excellence, and characteristics of coffee beans, along with the punctuality of shipments, are accurately recorded and conveyed. Precise and reliable data is essential for predicting demand, controlling inventory, and making well-informed choices (Pereira et al., 2019). Maximizing precision significantly decreases inaccuracies, diminishes inefficiencies, and fosters confidence among collaborators, which results in better customer satisfaction and operational effectiveness.

Many studies discuss the importance of visibility and accuracy of the information in supply chain management (Li et al., 2017; Beheshti et al., 2014; Saleem et al., 2021). They explain that the visibility and accuracy of the information can improve supply chain performance. Other studies stated that accuracy is represented by good quality of information exchange (Azis et al., 2022; Somapa et al., 2018; Tan et al., 2023; Thiruchelvam et al., 2018), including the value of information, timeliness, credibility, and adequacy of the information exchanged. The more accurate the information shared, the more accurate the decision-making, and the more effective the supply chain management (Maskey et al., 2020).

The literature study emphasizes the significance of information visibility and accuracy in supply chain management, as well as the primary objective of supply chain management to fulfill customer demands for high-quality products at inexpensive prices and with the shortest lead-time. Despite the recognition of the significance of information visibility and accuracy in enhancing supply chain performance, there is still a lack of research on the specific application of these concepts in the coffee sector.

Previous research has highlighted the significance of information visibility and accuracy in enhancing supply chain performance. However, these studies have not specifically examined the use of these factors in the context of the coffee sector. Geographic variances in production techniques, sustainability-related difficulties, and global market dynamics have distinct effects on supply chain dynamics within the coffee business. Thus, there is a lack in the existing literature about the practical use of information visibility and accuracy approaches to enhance the effectiveness and productivity of coffee supply chains.

Moreover, the paragraphs emphasize the significance of adaptability, promptness, and the utilization of responsive decision aids in supply chain management. Nevertheless, there is a lack of investigation that precisely applies these notions inside the coffee sector. Hence, there is a chance to investigate the successful use of these factors in enhancing the visibility and precision of information, as well as the overall efficiency of the coffee supply chain.

The literature review reveals gaps in the existing literature about the implementation of visibility, information accuracy, flexibility, and responsiveness ideas within the coffee sector. Thus, this study aims to investigate fresh ideas to improve the visibility and accuracy of data in the coffee supply chain, while also identifying effective strategies to improve the efficiency of the coffee supply chain using adaptable and responsive decision-making tools.

Research methods

This explanatory qualitative research utilizes descriptive data to analyze and describe informed perceptions and social dynamics (Bowen et al., 2017) along Indonesia coffee supply chain on how to improve performance on the visibility and accuracy of information. The research framework is built based on the existing problems and phenomena as well as the research objectives that have been described. The research began with the exploration and development of the basic assumptions of research and the rules of thought, then continued with the stages of collecting and validating data through focus group discussions, and the modeling stage through reduction, categorization, analysis, and interpretation of data (LeCompte & Schensul, 2012).

The coffee industry was selected due to its distinctive attributes that render it a captivating and significant subject of research. The coffee business has an intricate supply chain and is vulnerable to challenges regarding the visibility and accuracy of data, which may impact the quality of the product and the effectiveness of operations. This research aims to investigate the difficulties the coffee sector encounters in enhancing the visibility and accuracy of its supply chain data. The respondents were chosen using a thorough and focused methodology. The authors reached out to multiple players in the coffee industry, to obtain a comprehensive representation of different facets of the supply chain. The respondents included: 63 coffee farmers, 4 farmer groups, 18 coffee processors, 21 domestic coffee roasters, 15 collectors, 37 coffee retailers, 8 distributors, 4 domestic wholesalers, 4 intermediaries, and 3 exporters. Using this approach ensures a holistic and in-depth understanding of the challenges and perspectives regarding data visibility and accuracy in the coffee industry is gained. The chosen strategy aims to obtain a comprehensive and detailed understanding of the difficulties encountered by the coffee sector concerning the visibility and accuracy of supply chain management data.

The researcher employed a snowball sampling technique, whereby current participants referred other potential participants who provided important insights. This strategy facilitated the increase in the number of participants and ensured that the authors managed to reach individuals who may have been initially inaccessible through alternative techniques. Furthermore, it employs purposeful sampling methods to provide a varied and inclusive representation of stakeholders. Purposive sampling is a method of selecting participants for a study based on certain criteria that are directly related to the research goals. The authors of this study aimed to recruit participants from diverse roles and perspectives within the coffee supply chain. This included coffee producers, including coffee farmers, coffee bean processors, domestic roasters, and farmer groups. It also included traders, such as collectors, coffee retailers, distributors, domestic wholesalers, intermediaries, and exporters in Indonesia. The difference between coffee farmers and farmer groups is that coffee farmers are persons who generally have skills in coffee cultivation, including knowledge of agricultural procedures and climate issues. Meanwhile, farmer groups are organizations formed as a forum to unite coffee producing communities to achieve common goals, such as providing coffee seeds, sharing knowledge about effective procedures for growing coffee or increasing coffee yields, as a means of information for easy market access, and improving welfare. member. The farmer group is led by a coordinator in carrying out various aspects of coffee production, such as: planting, maintenance, harvesting, sales and post-harvest processing.

Multiple techniques were employed to ascertain and choose participants who represent different stakeholders in the coffee supply chain in Indonesia. Firstly, by using an extensive network within the coffee sector, to establish communication with various parties and organizations engaged in the production, processing, distribution, and sale of coffee. This network enables the identification of crucial persons and organizations with significant insights and expertise concerning the visibility and precision of information in the coffee supply chain. During the process of identifying respondents, the study maintains transparency by clearly communicating its aims and objectives. Effective communication of the research’s objective and the potential advantages of involvement aids in establishing trust and rapport with potential respondents, hence fostering their willingness to actively participate in the research.

This study adheres to the Declaration of Helsinki where all participants gave their consent to be involved in this study. Verbal informed consent was obtained from every participant, with particular emphasis on participants engaged in interviews and focus group discussions (FGD). Before commencing any data collection activities, all participants were supplied with comprehensive information about the study’s aims, methodologies, and advantages. They were informed that their participation was voluntary, and that anonymity and confidentiality would be maintained. Verbal consent was deemed appropriate and sufficient by the independent ethics committee within Research and Community Service office due to cultural considerations and varying literacy levels among participants, ensuring that all participants fully understood the research and their involvement, and all participant identities remained confidential. This approach has fulfilled the ethical approval issued together with the research approval with reference number 499/EKUITAS/LPPM/VI/2022 by the independent ethics committee of STIE Ekuitas School of Business Research and Community Service office.

The supporting data were obtained through observation and in-depth interviews directly, through online and onsite forums, and supported by reviewing documents provided by related parties. In addition, two workshops were also conducted to explore what key informants had done to identify motives, build trust, and create a common perception in developing coffee supply chain performance, then triangulation was carried out with policymakers and other relevant parties to validate the model. In addition, to determine the representation of critical factors in the research dimensions, DEMATEL (decision-making trial and evaluation laboratory) was utilized (Hsu & Lee, 2014). This comprehensive method is believed to be able to produce a strong foundation for causal relationships between various factors to design and analyze the structure of the proposed model (Hsu & Lee, 2014).

This study utilized DEMATEL to ascertain the crucial aspects that impact the visibility and accuracy of data within the coffee industry supply chain. The process involves determining the primary determinants by a thorough examination of the literature and engaging in discussions with specialists. A questionnaire was created to gather the opinions of different stakeholders about how each aspect directly affects other factors, based on the identified factors. Following this stage, the questionnaire is utilized to create a direct relationship matrix, which is subsequently normalized to get a direct influence matrix. Moreover, DEMATEL analysis offers comprehensive understanding of the connections among elements and aids in identifying areas that require immediate attention for enhancement. Factors that have a significant impact and clear cause-and-effect correlations are recognized as the key to enhancing the visibility and quality of supply chain data in the coffee sector. This serves as a solid foundation for implementing more focused and efficient measures to enhance the performance of the coffee supply chain.

The author employed content analysis and thematic analysis methodologies to examine the data. The selection of this approach was determined by the characteristics of the gathered data and the research objective of comprehensively analyzing the difficulties and determining the aspects that enhance the visibility and accuracy of supply chain management data in the coffee sector. Qualitative data analysis, including techniques like content analysis and thematic analysis, is crucial in the coffee business to comprehend the difficulties encountered in enhancing the accuracy and visibility of supply chain management data. Content analysis is a methodical procedure for finding, classifying, and examining patterns or themes that arise from written or spoken language. This technique is particularly valuable when researchers seek to understand the prevalence and dispersion of specific subjects within the data. During content analysis, researchers can discern and classify data gathered from interviews conducted with diverse stakeholders in the coffee industry, including farmers, grinders, and retailers. This technique enables researchers to discover crucial insights into the management of the coffee supply chain, such as the impact of changes in the weather on production, the necessity for elevated quality standards, and the difficulties encountered in transportation and distribution.

Thematic analysis is a method used to identify, analyze, and report patterns or themes that arise from qualitative data. The objective is to uncover the essence of the statements or actions made by research participants. Thematic analysis enables researchers to investigate the repetitive patterns in the data, such as the themes of environmental sustainability, social justice for coffee farmers, or risk management in supply networks.

The procedures followed for these two processes are: (1) Analysis of content: (a) Coding: Analyze the text and assign a specific label or code to each relevant item of information; (a) Categorization: The process of classifying elements of information into broader categories based on shared themes or concepts. (c) Analysis: By examining patterns or connections between categories and interpreting the results, content analysis can express thoughts, perceptions, and behavioral patterns that arise from qualitative data. Additionally, it can identify important trends or issues. (2) Thematic analysis comprises the subsequent stages: (a) Thematic mapping: The process of identifying recurring themes or patterns in the data. (b) Coding: Assigning codes to data based on identified themes or motifs. (c) subject development: The process of categorizing and analyzing these codes to create overarching themes or patterns with a specific subject. (d) Analysis: The process of comprehending and clarifying the primary discoveries derived from the data and providing interpretations of the thematic significance within the study environment, thus Thematic analysis facilitates researchers in digging into a deeper understanding of research participants’ perspectives, encounters, and interpretations of the topic being investigated.

By employing these methodologies, researchers can get a thorough understanding of the complexities of the coffee supply chain, pinpoint certain obstacles that require attention, and propose feasible solutions for improving the transparency and accuracy of supply chain management data in the coffee sector (see Figure 1). Researchers can analyze various elements and aspects of qualitative data, determine emerging patterns or themes, and gain an extensive understanding of the phenomena examined within the framework of research on improving the accuracy and visibility of supply chain management data in the coffee industry.

Figure 1. Survey main steps.

The following figure provides a brief overview of those main steps.

Findings

The study recruited participants from many stakeholders who have roles in the coffee supply chain in Indonesia. Coffee producers, including coffee farmers, coffee plantation managers, and large coffee farming organizations, play a crucial role in the coffee supply chain. Coffee growers typically hold substantial expertise in coffee cultivation, encompassing a profound understanding of agricultural procedures, climate adversities, and other variables that impact coffee production. However, major coffee farming businesses may have a more comprehensive understanding of industry dynamics and specific operational difficulties that are specific to their operations. In addition, coffee traders and processors play a crucial role in the supply chain. Coffee traders, whether operating independently or associated with major corporations, have extensive expertise in local and global coffee markets, as well as the procedures involved in acquiring and marketing unprocessed coffee beans. However, coffee processors, including specialty coffee makers and major coffee processing factories, possess expertise in the process of drying and grinding coffee beans to create a finished product that is prepared for distribution to customers.

Moreover, coffee distributors and retailers have a crucial function in linking coffee products with final consumers. Distributors have the function of transporting the product from the manufacturer or processor to the point of sale, whilst coffee retailers, such as local coffee shops or worldwide cafe chains, directly engage with consumers and are accountable for the final experience of the consumer. Every participant in the coffee supply chain holds different viewpoints and concerns on the topics under investigation, such as the transparency and accuracy of information. Coffee growers prioritize the steady supply of raw materials and reasonable pricing, while coffee traders and producers emphasize operational efficiency and the sustainability of the supply chain. However, coffee distributors and merchants may prioritize consumer satisfaction and risk management in relation to the quality and availability of their products.

Through the participation of multiple stakeholders, researchers obtained a thorough understanding of the obstacles and potential within the coffee supply chain in Indonesia. Additionally, they acquired valuable knowledge on enhancing the industry’s overall performance by improving the visibility and accuracy of information.

The questions presented were open-ended and encompassed various aspects relevant to the research objective. These questions aim to lead the communication between researchers and participants and serve as the foundation for data analysis. The following are several inquiries raised in this study:

1. “What are the primary obstacles encountered in the coffee supply chain?” The purpose of this question is to ascertain the primary challenges encountered by participants in their day-to-day activities within the coffee supply chain.

2. “What is your strategy for overseeing your coffee stock?” This topic prompted a discussion of the inventory management procedures employed by the participants and highlighted areas where improving the visibility and accuracy of information could enhance operational efficiency.

3. “Have you encountered any issues with the delivery of coffee?” The purpose of this inquiry is to identify potential challenges that may occur throughout the coffee shipment process and examine how they might impact the entire supply chain.

4. “How crucial is it for you to have a thorough knowledge of coffee inventory and the current status of deliveries?” This inquiry investigates the awareness of participants regarding the significance of precise and current information in the management of their supply chain.

5. “What measures have you taken to enhance the visibility and accuracy of information in your coffee supply chain?” This question seeks to investigate the measures or projects that participants have undertaken to address difficulties pertaining to the visibility and accuracy of information.

6. “Do you perceive advantages in partnering with other entities in the coffee supply chain to improve the transparency and accuracy of information?” This inquiry explores the possible advantages of cooperation among different entities in the supply chain to attain common objectives related to the visibility and accuracy of information.

Through the examination of participants’ answers to these inquiries, researchers can acquire a profound comprehension of the difficulties encountered in the coffee supply chain and possible strategies to enhance the visibility and accuracy of information. This will serve as the foundation for data analysis and assist in developing recommendations for improving the coffee business.

As the findings, the value of information is directly correlated to the benefits it provides to its users, and conversely. There has been a significant change in the coffee supply chain, where the focus has shifted from individualistic inventory control, withdrawal processes, design, and security to the importance of visibility and globally standardized information networks. This considers the obstacles to being discovered, including the inability of coffee-producing enterprises to build their own mechanisms for being recognized, and the requirement for worldwide distribution. Nevertheless, the primary discovery necessitates an evaluation of the information’s worth and utility using appropriate criteria. Only after thorough assessment can the information be employed to mitigate ambiguity in the decision-making process. To improve the visibility and quality of information in the coffee supply chain in Indonesia, several research activities have been conducted from 2021 to 2022.

The primary objective of the preliminary inquiry was to address three key aspects in the coffee supply chain: supply planning, demand planning, and demand fulfillment. The focus was on enhancing visibility to effectively manage these areas. Information visibility is essential for improving the allocation of firm resources in supply planning. This includes strategic and tactical operations such as inventory management, distribution, collaborative procurement, transportation planning, and supply allocation. Regarding demand planning, it is essential to have access to information to comprehend client buying trends and create cooperative projections. Similarly, in demand fulfilment, visibility is necessary to provide prompt, precise, and accurate responses to customer orders. This encompasses the sequential phases of operations, which comprise primarily client engagement, scheduling order appointments, handling deposits, and executing order fulfilment.

Visibility on the coffee supply chain is not only insight into the data itself, but also about producing data through easily accessible items (Azis et al., 2022; Irjayanti & Azis, 2023). Most coffee businesses in Indonesia were forced to adapt to this disturbing situation without the support of important information. From the results of in-depth interviews, coffee businesses face the following six problems related to the long-term visibility of their supply chain, including: (1) Quick adaptation to dynamic or unplanned changes; (2) On-time product delivery; (3) Substandard inputs of materials or commodities; (4) Taking prompt corrective action inability; (5) External environmental influences that harm the supply chain; (6) A closed system with limited access or no data sharing.

In order to establish an integrated coffee supply chain, it is essential to implement a standardized framework for information exchange and a unified document. Also, a central gateway for administrative procedures, streamlined cross-border protocols for all transportation methods, and reliable infrastructure connecting different regions are crucial. It is essential to emphasize the necessity of implementing standards, specifically in the identification, acquisition, and sharing of commercial data electronically. This is essential in ensuring the capacity to track logistics, guarantee product safety and quality, and instill consumer trust.

For effective supply chain decision-making in the coffee business, it is crucial to have high-quality information. This ensures accurate data processing, leading to significant benefits in organizing the supply chain. The quality information-based decision-making model in the coffee supply chain can be succinctly defined by these four stages.

The image in Figure 2 demonstrates that good quality information can be attained when: (a) Appropriate, meaning it is devoid of errors, neutral, and not misleading; (b) Timeliness refers to the information being obtained or used in a timely manner, being up-to-date, and having a consistent updating frequency; (c) Relevant, means that the information is in line with the needs of its users; (d) Completeness refers to the information being non-redundant, clear, and detailed; (e) Scope, refers to the information that fits within the specified or required timeframe, as well as being adequate for the range of management or user parties for every item of information. Once the necessary conditions for high-quality information are fulfilled, data processing can commence. This data processing encompasses several operations, such as data collecting, data engineering, data storage, efficient reuse, and the presentation of accurate documents. Consequently, standardizing the advantages derived from all operations in the coffee supply chain can minimize variation and effectively diminish uncertainty, diversity, and potential hazards encountered by coffee stakeholders and entrepreneurs in Indonesia. Ultimately, this entire procedure will enable decision-makers to obtain optimal decisions at each stage they undertake.

Figure 2. Quality information-based decision-making model in coffee industry supply chain.

Source: Extracted from the survey and data collection, 2022.

In order to facilitate the effective use of reliable information for decision-making, it is essential to develop specific indicators that measure the performance of information visibility and accuracy within the coffee supply chain in Indonesia. These indicators are depicted in the following Figure 3.

Figure 3. Supply chain visibility and information accuracy performance.

Source: Extracted from the survey and data collection, 2022.

The coffee supply chain can be strengthened in aspects of information visibility and accuracy through three primary indicators: smart operations, security systems, and platform collaborations. A smart operation refers to a system that is fully integrated into the operation process with a real-time response (Ivanov et al., 2021; Pfitscher et al., 2018). With this system, demands from various dynamic supply chain conditions can be handled more intelligently through automation and optimization processes. For this first main indicator, several characteristics must be met to improve the performance of the coffee supply chain in Indonesia. These characteristics are automatic real-time processes, instant access to relevant information, agile data conversion, and data efficiency.

The security system, as the secondary primary indication, is a technique employed to assist in the maintenance of the utilized hardware and software, as validated by several investigations (Sihombing et al., 2018; Yoannan et al., 2013). In supply chain information systems, this security system is useful for protecting inputted data when the coffee business is connected to the network, then preventing hacking of user computers through a strong firewall and detecting the presence of malware. For this second main indicator, there are several characteristics, namely: high-security standards, disruption protection, recovery plans, and systematic data filtering. The next main indicator is collaboration platforms, referring to the connectedness of all parties in the supply chain to achieve economies of scale, through a series of more efficient interactions over administrative processes, monitoring real-time delivery data, audit processes, and others (Abbas et al., 2022; Schubert & Williams, 2022). There are three characteristics for this third indicator, namely intensive interaction, sufficient capacity system, and global scale platform.

Figure 4 illustrates the process of delivering value in the coffee supply chain in Indonesia. The channel is comprised of multiple entities across the whole supply chain, ranging from coffee cultivators to end customers who derive satisfaction from consuming brewed coffee. The entities involved in the value generation chain should collaborate or form partnerships with the goal of enhancing the overall system performance. This task can be accomplished using an intelligent and secure operating system via a cooperative platform. Given the rapid advancement of technology and the growing reliance on digital platforms in the business sector, it is imperative to leverage the expanding telecommunication network in Indonesia. This network encompasses both internet and mobile phone connectivity, enabling faster and real-time interactions throughout the entire coffee supply chain, from production to distribution. Research findings indicated that traditional multi-channel retailers typically employ distinct structures for physical distribution and online sales via Internet platforms (Gallino & Moreno, 2014).

Figure 4. The coffee supply chain value delivery channeling: Information and product flows.

Source: Extracted from the survey and data collection, 2022.

Effective coordination of service processes and technology is essential to integrate the fragmented information and physical distribution of coffee in Indonesia. This integration will ensure a consistent cross-channel experience for all parties involved in serving the customers. Therefore, all parties have the opportunity to evaluate all viable options across several channels, in order to mitigate the typical issues that arise in supply chains that lack integration, such as localized optimization, inadequate incentives, and excessive batch sizes (Azis et al., 2022).

Local optimization refers to a situation in which every participant in the coffee supply chain strives to maximize their productivity and efficiency in production. As a business entity, each party varies in terms of effectiveness and efficiency. Therefore, any deliberate or random alterations in the quantity of supply or distribution conducted by one party might impact other parties within its local supply chain, resulting in suboptimal performance of the entire supply chain. Low incentives arise when coffee distributors engage in diverse promotional activities to boost sales, resulting in an unanticipated surge in customer demand that goes unnoticed by the provider. Naturally, this circumstance may be readily predicted, provided that the data supplied by both parties is effectively incorporated into the supply chain large lots provide challenges in integrating the supply chain at the internal level of the organization, typically arising between the production department and the logistics and shipping department. The logistics and delivery department presumes that the delivery will be efficient if it is executed in a single consignment, however, the production department, given its current production capacity, is incapable of meeting this requirement. To address this issue, companies can leverage an integrated supply chain system by engaging in collaborative efforts with external entities within the local supply chain. By doing so, companies facing significant challenges in terms of supply can request their partners to augment the supply volume, thereby enhancing production capacity and improving delivery efficiency.

To accommodate these diverse interests, every person involved in the coffee supply chain must possess approved access. It is essential to ensure that the information used is reliable and offers significant benefits to all participants in the coffee supply chain, including farmers, manufacturers, merchants, and consumers, based on their capabilities. The authorized access can be either data viewing or data modification. Furthermore, this access can also serve as a deterrent against illegal entities exploiting it, mitigating the risk of compromising the entire supply chain. In addition, it is critical to implement access control measures to safeguard data from unlawful access to information or the provision of data, as well as other aspects within the coffee supply chain. This control facilitates the achievement of secrecy and integrity. These two factors guarantee that only authorized parties can access, edit, or alter the data on the shared platform.

Moreover, Figure 4 illustrates the presence of three distinct routes inside the coffee supply chain: the conventional channel, an intermediate channel, and the direct channel. Each of the three channels contains distinct attributes and limitations. 54% of business entities engage in transactions through traditional channels involving various parties in the supply chain, ranging from farmers to consumers. The remaining 46% employ a combination of utilizing a single intermediary channel or acting as direct sellers to consumers. This is achieved through direct channels such as operating coffee shops or accepting online consumer orders.

In traditional channels, the parties typically engage in business transactions relying on trust. Information is transmitted directly, using a one-on-one approach, between business actors. The parties engage in communication using various means such as telephone, text messaging, messenger applications, or other similar software, as well as email, or by directly visiting the point of sale. For bulk orders, the ordering process takes place in advance, typically 1–2 months prior to the desired delivery date. The payment is made by a transfer form, with a payment period of 1–2 months after the items have been received. Goods are delivered either directly for small purchase quantities or through third-party services for larger volumes. The shipping costs are determined by the agreement between the parties involved and are typically paid by the seller or shared by both parties.

In a distribution channel with a single intermediary, this arrangement occurs due to the contractual agreement between the prominent manufacturer and the distributor for the sale of their products, despite the absence of exclusivity in this scenario. Distributors undertake this action to fulfil the substantial demand, both domestically and for international trade. In this channel, distributors could generate precise predictions of demand, enabling more effective supply planning that is normally reliable for the upcoming 6-12 months. Also, the distributors provide a more secure supply for the next 6-9 months by making advance payments. This is achievable due to the formation of enhanced collaboration between the two parties. The primary benefit of this channel is the assured manufacturing and supply for distributors based on anticipated consumer demand.

The direct channel type emerges when coffee shop customers, who prefer brewed coffee, actively encourage cafe businesses to purchase the highest quality coffee from producers directly. The coffee available in these establishments is provided in the form of processed coffee beans and grounds, which are then further prepared by coffee makers in coffee shops using various brewing techniques and flavors. This is carried out to attract more customers through creative efforts. The number of purchases made through this channel is typically limited, as it varies based on the specific requirements and size of each coffee shop. However, given the significant number of coffee shops in several locations in Indonesia, this channel is predominantly utilized because farmers or producers can control higher prices compared to selling through intermediaries such as collectors or manufacturers.

Discussions

The reported findings clarify various crucial facets about the visibility and accuracy of information within the coffee supply chain in Indonesia. The significance of information lies in its ability to offer immediate advantages to users and effectively adapt to major shifts in the coffee supply chain. This includes transitioning from a focus on individual inventory management to recognizing the value of visibility and standardized global information networks (Azis et al., 2022; Li et al., 2017). Nevertheless, there remain challenges to overcome to get sufficient awareness, such as the issues experienced by coffee businesses in establishing their recognition systems and the requirement for worldwide distribution (Sihombing et al., 2018; Yoannan et al., 2013). The primary discoveries of this study emphasize the necessity of evaluating the worth and efficacy of information using suitable criteria before utilizing it to diminish uncertainty in the decision-making procedure.

Moreover, the findings indicate that efforts to improve the visibility and accuracy of the information in the coffee supply chain in Indonesia have been undertaken through diverse research endeavors lasting from 2021 to 2022. This study aims to investigate three crucial elements in the coffee supply chain: supply planning, demand planning, and request fulfillment (Irjayanti & Azis, 2023). This research proposes to improve visibility to better manage such areas. Enhancing the accessibility of information is essential for optimizing the allocation of firm resources in supply planning, demand planning, and demand fulfilment. It also enables the prompt, precise, and accurate handling of requests from customers.

Nevertheless, the investigation also revealed that numerous coffee enterprises in Indonesia were compelled to adjust to troubling circumstances without adequate information assistance. The findings from extensive interviews unveiled various challenges that coffee businesses encounter concerning the sustained visibility of their supply chains. These challenges encompass the ability to swiftly adapt to unanticipated or fluctuating situations, ensure punctual delivery of products, maintain high standards for raw materials, promptly implement corrective measures, mitigate the adverse effects of the external environment on the supply chain, and deal with closed systems that have restricted access or lack data sharing functions (Azis et al., 2022; Azis & Irjayanti, 2023).

In addition, to improve the coffee supply chain, it is essential to establish a standardized framework for the seamless exchange of information and documents, along with a centralized gateway for administrative procedures. This should be accompanied by streamlined cross-border protocols for all modes of transportation and a robust infrastructure that connects different regions (Abbas et al., 2022; Schubert & Williams, 2022). Efficiently implementing standards, particularly in the electronic identification, acquisition, and dissemination of commercial data, plays a crucial role in monitoring logistics, guaranteeing product safety and quality, and encouraging customer trust (Azis et al., 2022).

High-quality information is required for making efficient decisions in the coffee supply chain. To achieve this objective, a framework is presented for making informed decisions in the coffee supply chain. The framework consists of four stages, with the initial stage being the vital task of ensuring that the information utilized satisfies the necessary quality standards. Subsequently, a data processing procedure must be conducted, encompassing several operations such as data gathering, data engineering, data storage, optimal data reuse, and precise document presentation. By implementing standardized benefits across all operations in the coffee supply chain, it is possible to minimize variations and effectively reduce the uncertainty, diversity, and potential risks faced by stakeholders and coffee entrepreneurs in Indonesia (Ivanov et al., 2021; Pfitscher et al., 2018).

The findings and analysis in this discussion emphasize the problems and potential solutions for improving the visibility and accuracy of information in the coffee supply chain in Indonesia. By understanding these discoveries, we can formulate more efficient strategies that increase the efficiency and resilience of the coffee supply chain and provide greater benefits to all participants in the business.

The study aims to create a development model that improves visibility and information accuracy in the coffee supply chain in a specific area of Indonesia. This model demonstrates how smart operations, security systems, and platform collaborations work together to improve visibility and information accuracy. Smart operations encompass the utilization of applied information technology and predictive analytics to automate operational activities and obtain immediate insight into the functioning of the supply chain (Ivanov et al., 2021; Thiruchelvam et al., 2018). Security systems encompass the implementation of robust data security measures and access controls to safeguard sensitive information from cyber-attacks and unauthorized individuals. The collaboration platform enhances collaboration across different participants in the coffee industry by utilizing collaborative networks and system integration, hence enabling more streamlined and productive sharing of information. The concept emphasizes the interconnectedness of smart operations, security systems, and platform collaborations. Deploying advanced information technology in intelligent operations necessitates robust security systems to mitigate any security risks (Pundir et al., 2019; Sihombing et al., 2018). Effective collaboration among different stakeholders using collaborative platforms necessitates robust data management and adherence to privacy policies. In order improve efficiency, this model prioritizes the implementation of optimal methods in the utilization of information technology, ensuring data security, and promoting collaboration across different platforms. Ensuring the model’s effectiveness requires both relevant education and training, as well as a consistent review of the system and platform performance. Therefore, this development model has the potential to assist the Indonesian coffee sector in formulating more efficient methods to enhance the visibility and accuracy of information throughout the supply chain.

In addition, this study employs distinct metrics or parameters for each of the indicators, including smart operations, security systems, and platform partnerships, to assess their performance. Smart operations can be assessed by evaluating their operational efficiency, utilization of information technology, and implementation of best practices in supply chain management (Ivanov et al., 2021; Pfitscher et al., 2018; Sugara & Azis, 2020). Operational efficiency can be determined by monitoring the duration of operating cycles, the amount of inventory, and the frequency of errors or failures in production and distribution operations. The utilization of information technology can be assessed by quantifying the degree to which technologies such as integrated supply chain management systems, predictive analysis algorithms, and e-commerce platforms are employed in day-to-day operations. The assessment of the implementation of industry standards and quality management frameworks can be utilized to evaluate the adoption of best practices.

Furthermore, the effectiveness of security systems can be examined by assessing their data security measures, access control protocols, and adherence to specific security standards. The measurement of data security can be conducted by evaluating the extent of data encryption, the effectiveness of cyber threat monitoring systems, and the adequacy of data management policies that are aligned with relevant privacy rules. Access controls can be verified by monitoring the individuals who have permission to access sensitive systems and data, as well as the measures taken to prevent illegal access. One can assess compliance with a certain security standard by evaluating a company’s security activities against applicable industry security frameworks. Lastly, the measurement of platform collaborations can be determined by assessing the extent of engagement and interaction among different stakeholders inside the collaborative platform. The degree of involvement can be measured by tracking the frequency of active involvement and contributions from different stakeholders, including coffee farmers, processors, distributors, and consumers, in forums and collaborative initiatives. The level of stakeholder interaction can be assessed by evaluating the platform’s efficacy in promoting information exchange, coordinating activities, and enabling shared decision-making among different parties (Pundir et al., 2019; Tan et al., 2023).

This model can comprehensively evaluate the performance of smart operations, security systems, and platform collaborations by utilizing appropriate metrics or parameters for each indicator. It aims to identify areas that require improvement and enhance their contribution to improving the visibility and accuracy of information in the coffee supply chain.

Conclusions and recommendations

The perception of the coffee supply chain has experienced a substantial transformation. Previously, the emphasis was placed on discrete elements such as inventory management, withdrawal procedures, design, and security. At this stage, there has been a transition towards a globally recognized information system. Therefore, an evaluation of this system must be conducted using suitable criteria to reduce uncertainty in decision-making. To optimize performance, it is essential to build a standardized framework for exchanging information and a standardized document, together with a central gateway for administrative procedures. This framework should include standardized cross-border procedures for all kinds of transportation, guaranteeing effectiveness and inter-regional infrastructure. Moreover, it is crucial to develop specific standards for the recognition, procurement, and distribution of commercial data via electronic methods, to provide the capability to monitor logistics, ensure the safety and excellence of products, and foster consumer confidence. To improve the clarity and precision of information in the coffee supply chain, it is essential to prioritize three important factors: intelligent operations, robust security systems, and collaborative platforms.

The findings indicated that the value delivery channeling of the coffee supply chain in several locations in Indonesia is established through the cooperation of multiple entities. This collaboration aims to enhance the overall system performance by implementing an intelligent and secure operating system on a collaborative platform. The objective is to mitigate issues such as local optimization, insufficient incentives, and large quantities of products in the conventional channel, intermediary channel, or direct channel of the coffee supply chain in Indonesia. To assure the accuracy and visibility of the information, it is recommended to immediately test the findings on the three existing channel types as a practical measure. Furthermore, it is necessary to carry out individual assessments on every link inside the current chain, as well as evaluate the level of capability of these commercial businesses.

Research significance

This study offers a significant contribution to the existing research on coffee in Indonesia by addressing the lack of investigations particularly focused on the visibility and accuracy of information related to the coffee supply chain in Indonesia. This research aims to address the primary issue of limited visibility to supply chain information for coffee industry professionals in Indonesia. To improve the clarity and precision of information in the coffee supply chain, it is essential to prioritize three important factors: intelligent operations, robust security systems, and collaborative platforms. This research can benefit coffee industry practitioners seeking to establish information technology system models for efficient monitoring of coffee-related data.

Authors’ contributions

The authors (AMA and MI) affirm that we were both actively engaged in the conception and design of the study, the analysis and interpretation of the data, as well as the drafting of the paper. Both authors contributed substantially to writing the manuscript critically for intellectual content. All authors agree to be accountable for all aspects of the work conducted in this study, and MI has the role as corresponding author in this article.

Disclosure statement

In accordance with Taylor & Francis policy and the ethical obligation as a researcher, we are reporting that we received funding from the Research Grant awarded by Ministry of Research, Technology and Higher Education Indonesia. We have disclosed those interests fully to Taylor & Francis, and we have an approved plan for managing potential conflicts. All authors declare that there are no competing interests in conducting this research.

Data availability statement

The data that support the findings of this study are available from the corresponding author [MI], upon reasonable request.

Additional information

Funding

This research was funded by the Ministry of Research, Technology and Higher Education Indonesia (Grant Agreement Number: 070/E5/PG.02.00.PT/2022).

Notes on contributors

Anton Mulyono Azis

Anton Mulyono Azis is an Associate Professor at School of Economics and Business, Telkom University Indonesia. He gained his doctoral degree from Bandung Institute of Technology, Indonesia. His research area mainly focuses on supply chain management and performance in operation management.

Maya Irjayanti

Maya Irjayanti was graduated from Curtin University of Western Australia. She is an Associate Professor at School of Economics and Business Telkom University, Indonesia. Her research is mainly focused at operation management area including supply chain, quality, and performance in operation management.