MODELLING THE LINK BETWEEN SUPPLY CHAIN ANALYTICS, SUPPLY CHAIN INNOVATION AND COMPETITIVE ADVANTAGE: A STRUCTURAL EQUATION MODELLING APPROACH

Abstract

Little are known about the nature of the interaction between supply chain analytics, supply chain innovation and competitive advantage. The purpose of this paper is to propose and validate a theoretical model to investigate whether supply chain analytics positively affects supply chain innovation and competitive advantage, and to examine how supply chain innovation may improve competitive advantage. A theoretical model was developed from extant studies and assessed through the development of a questionnaire survey conducted with South African manufacturers and logistics intermediaries involved in global supply chain operations. The data was analysed using confirmatory factor analysis and structural equation modelling (PLS-SEM) to validate the suggested model. It was found that supply chain analytics have a discernible positive influence on supply chain innovation and competitive advantage. Furthermore, supply chain innovation was found to have a significant impact on enhancing competitive advantage. Therefore, this work provides evidence for the importance of supply chain analytics and supply chain innovation in supporting competitive advantage, in doing so, supply chain innovation mediates the link supply chain analytics and competitive advantage. This study contributes to providing an empirical understanding of the strategic retention of supply chain analytics and supply chain innovation in the supply chain management discipline. Furthermore, it confirms and expands existing theories about innovation and competitive advantage. The findings provide firm grounds for managerial decisions on investment in innovation. This research is the first of its kind to empirically validate the relationships between supply chain analytics, supply chain innovation and competitive advantage in South Africa.\nKeywords: competitive advantage; supply chain innovation; supply chain analytics; structural equation modelling.