The Interplay Between Supplier Management Practices and Customer Satisfaction: An Empirical Investigation of the Banking Industry in a Developing Country

Abstract

The study aims to investigate the interplay among supplier quality management (SQM), supplier relationship practices (SRP), process management (PRM), and customer focus (CF) within the value chain of the banking industry in a developing country perspective and to identify how these factors influence customer satisfaction (CS). Empirical data have been collected through a structured questionnaire from 463 bank employees of a developing country using a nonprobability convenience sampling strategy. The study employs a structural equation modeling approach to analyze the relationship between endogenous and exogenous variables. The study finds that SRP, PRM, and CF have a significant positive influence over CS. It also highlights that SQM has a significant positive relationship with the SRP and PRM. The study reveals that PRM mediates the relationship partially between SQM & CF and SQM & CS. Further, CF mediates the relationship partially between PRM and CS, while SRP mediates the relationship partially between SQM and CS. The findings of this research provide valuable insight into the stakeholders associated with the banking sector and policymakers regarding the importance of supplier management practices, particularly enabling the banks of emerging economies to understand the influence of SQM and SRP on guiding PRM, CF, and CS. The study only focuses on one developing country perspective and one specific industry, which may limit the generalizability of the findings to other contexts. Future research could expand the scope to include multiple developing countries and industries to validate the findings and investigate the moderating effect of contextual factors on the relationships between SQM, SRP, PRM, CF, and CS.