The Determinants of Firm Operational Performance

Abstract

Purpose – The purpose of this study is to examine the significance of supply chain management practices – customer focus and top management support – as well as the process control/improvement and supplier management towards the operational management. Design/methodology/approach – Applying the strategic-choice theory and the resource based view of firms to the supply chain, in this study a research model are developed to demonstrate the premise that implementing proper supply chain management practices that will enhance the firms’ operational performance. The study utilizes survey data from 100 senior executives and managers in the purchasing and supply chain practices from manufacturing firms in Malaysia. The results are based on regression analysis and equation modeling by using SPSS software. Findings – This project paper research was conducted to find the relationship between the variables to prove which factors that influence the firms’ operational performance and there are explanations why this happen. Hence, two of the hypotheses are accepted the findings of this study have answered the research objectives. Practical implications – For supply chain practitioners, the results indicate that firms benefit greatly if they consider the practices of their supply chain management and that such a matching yield to improve the firms’ operational performance. Originality/value – The paper theoretically develops logic for and empirically shows that all of the supply chain management practices are appropriate practices for mediating the impact on firms’ operational performance. Considered at a higher level of abstraction, these relationships indicate a contribution to theory that explains how supply chain management practices can result in firms’ operational performance, through the concurrent deployment of appropriately matched supply chain practices.