Abstract
In the mining industry that is plagued with increased competition and low profitability, gaining a competitive advantage is a mammoth task as the mining customers are faced with decreasing profit margins due to declining commodity prices and increases in critical cost drivers. Thus, there has been increased focus on more profitable production, which has meant an increased focus on a reliable supply of cost effective input materials such as explosives. Therefore, an explosives supplier should aim to offer a product and service which will optimise the mine’s costs. However, there is limited competitive advantage that can be derived from cost strategies (Naoui, 2014), thus many have opted to look for differentiation strategies through enhanced customer experience (Gonzalez, 2017).
This research is aimed at investigating how the supply chain performance of an explosives supplier affects the quality of service rendered to mining customers. The study is also aimed at determining what supply chain risk mitigation strategies can be used to improve the performance of the supply chain and the customer service thereafter. The research hypothesis is that “Supply chain risk management leads to a positive customer service experience” The hypothesis was to be proved by showing the effective management of supply chain risk increased supply chain performance which leads to an improvement in customer service experience.
The research was conducted using a single method qualitative approach, where the qualitative primary data was derived from interviews with personnel from four distinct groupings within the explosives supply chain, which consisted of production and supply chain personnel, sales representative and customers. The interviews were aimed at determining the critical customer service attributes that represented the various service quality elements that the customers deem important to their business performance.
The reader will benefit from the research as it highlights the risks that are inherent in the supply chain and shows how these risks can be mitigated with the implementation of supply chain performance measures to drive improved customer service experience. It provides insights into how to ensure improved customer service in stringent, highly regulated, supply chains and ultimately achieve competitive advantage.
M.Com. (Business Management)