Research Article
The Relationship between Supply Chain Integration and Firm Performance
Published: January 2012 · Vol. 41 No. 6 · pp. 1601-1627
Full Text
Abstract
Supply chain integration refers to strategic collaboration within or between firms, and companies have achieved significant performance improvements through supply chain integration. Although research on the relationship between supply chain integration and firm performance has been increasing, there is still no consensus on the dimensions of supply chain integration, and clear explanations of the relationships among specific dimensions have been lacking. Accordingly, this study proposed a research model and hypotheses based on the resource-based view, relational view, and extended resource-based view. The dimensions of supply chain integration were divided into three dimensions, and their relationships with firm performance were empirically confirmed. Additionally, the study tested whether firm size has a moderating effect on the relationship between supply chain integration and performance. This study was empirically conducted based on survey data from 193 firms across 22 industry sectors in domestic manufacturing. Before testing the hypotheses, the validity and reliability of the constructs proposed in this study were verified. Structural equation modeling was used to test the hypotheses regarding the relationships among constructs, and the proposed research model was compared with alternative models to verify its fitness. The results confirmed that the research model had the best fit. Furthermore, to examine the moderating effect of firm size, firms were divided into large and small groups, and multi-group comparison was performed between the two groups. The analysis results showed that (1) supply chain integration can be divided into three dimensions: internal integration, supplier integration, and customer integration; (2) internal integration is an antecedent of supplier integration and customer integration; and (3) firm size moderates the relationships between supplier integration and performance, and between customer integration and performance. This study thus empirically distinguished the somewhat unclear specific dimensions of supply chain integration based on domestic manufacturing data, clearly revealed the relationship between internal integration and firm performance, and identified a new moderating variable, thereby contributing to the understanding of the relationship between supply chain integration and performance.
