Supply chain agility in third-party logistics providers: its relationship with institutional and cultural geographical traits in a developing country

Abstract

PurposeThe purpose of this paper is to investigate the relationship between geographical traits consisting of institutional traits and cultural traits, and supply chain agility in third-party logistics providers.Design/methodology/approachA theoretical model was developed and assessed through a structured questionnaire survey using cross-sectional data from 170 third-party logistics providers registered in Uganda. To validate the suggested model, data were analysed using exploratory factor analysis, correlations and regressions.FindingsCorrelation results revealed that all institutional and cultural geographical traits in the model, i.e. infrastructural frameworks, regulatory frameworks, organisational culture and national culture are positively and significantly associated with supply chain agility. However, a further analysis using regression revealed that regulatory framework and organisational culture are the only significant predictors of supply chain agility and together, all the four traits account for 28.1% variance in supply chain agility.Research limitations/implicationsThis study applies the institutional theoretical framework to provide an empirical understanding of the role of institutional and cultural factors in supply chain management practice. Furthermore, it confirms and expands on the existing theories about supply chain agility.Practical implicationsThe findings provide firm ground for managerial decisions regarding emphasis on external factors in building firms' supply chain agility. Managers should scan the macro-environment and make conscious firm decisions regarding institutions and culture in certain geographical locations. The host countries should also be aware of their role in building firms' supply chain agility.Originality/valueDistinctive from the literature on antecedents of supply chain agility, which predominantly focuses on the firm and supply chain capabilities, this study utilises the paradigm of institutional fit to empirically show how managers in a developing country wishing to build supply chain agility should not only focus on their supply chains and internal operations, but go beyond and consider geographical traits when making firm location and/or operational decisions for certain geographical contexts in order to achieve fit.