The impact of supply chain integration on firm performance

Abstract

Purpose– This paper aims to provide empirical evidence of the effectiveness of various supply chain integration (SCI) practices under different competitive strategies in terms of cost leadership and differentiation.Design/methodology/approach– Survey methodology was used to collect data from 604 Chinese manufacturers. Hierarchical linear regression was used to analyze the moderating effects.Findings– The results showed that competitive strategies significantly influenced the effectiveness of SCI practices, including internal, process and product integration. More specifically, internal integration significantly affected the financial performance of cost leaders, while process integration contributed more to the financial performance of differentiators. However, competitive strategies had no significant moderating effect on the relationship between SCI and operational performance.Research limitations/implications– This study contributes to the literature by exploring the effectiveness of various SCI practices in relation to firm performance under different competitive strategies. The results should be treated with caution, as they may be more meaningful in China.Practical implications– The findings clarify the alignment of SCI with competitive strategies for practitioners, so that they can allocate their limited resources to build various SCI capabilities based on their strategic choices.Originality/value– The results enhance the body of knowledge on SCI from the perspective of contextual factors to explore its effectiveness at a more detailed level. This study extends the literature on the match between competitive strategies and SCI in improving financial performance.