The role of logistics in linking operations and marketing and influences on business performance

Abstract

PurposeThis study explores the individual and joint effects of operations, marketing, and logistics functions on the level of business performance. The main purpose is to test whether the business performance achieved when logistics function is in complete coordination with operations and marketing functions is superior to the performance when the functions operate in a less coordinated manner.Design/methodology/approachStudy hypotheses regarding the links between coordinated and non‐coordinated performances and overall business performance are evaluated through a survey of automobile manufacturers in northwest Turkey. Separate regression analyses are conducted to test the hypotheses.FindingsIt is shown that overall business performance achieved when there exists an effective coordination between the functions can be well above the performance achieved when the tasks are performed individually. Specifically, results from regression analyses performed to test the validations of study hypotheses indicate two important implications: coordination between operations and logistics functions in the specific sample is the most prominent issue for achievement of high performance; and logistics function carries an important role in linking the two most important functions of a company namely, operations and marketing.Originality/valueThis study adds some value to the current literature such that it empirically shows the links between coordinated and non‐coordinated functional performances and overall business performance, and eventually raises the importance of logistics function in a manufacturing‐oriented business environment.