The effect of supply chain management and total quality management on operational performance through competitive advantage

Abstract

Supply chain management is the process of integrating critical business procedures throughout the supply chain to generate value for stakeholders and customers. Total Quality Management is a system that emphasises quality and focuses on ensuring customer satisfaction. Customer satisfaction is a very important instrument for operational performance and business continuity. Therefore, this study aims to determine and analyse the effect of supply chain management (SCM) and total quality management (TQM) on operational performance (OP) mediated by competitive advantage (CA). Sample collection was carried out by distributing questionnaires, using purposive sampling technique, which is one of the non-probability sampling categories. The data analysis method uses structural equation model-partial least square (SEM-PLS). The results stated that the strategy of implementing supply chain management and total quality management together can increase competitive advantage. Increased competitive advantage can improve operational performance. The suggested policy implications are that the company can continue to maintain good relations with partners, produce products according to customer desires, competitive prices and timely products.