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Supply chain information systems strategy: Impacts on supply chain performance and firm performance

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  • Qrunfleh, Sufian
  • Tarafdar, Monideepa
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    Abstract

    This paper examines the relationship between supply chain (SC) strategy and supply chain information systems (IS) strategy, and its impact on supply chain performance and firm performance. Theorizing from the supply chain and IS literatures within an overarching framework of the information processing theory (IPT), we develop hypotheses proposing a positive moderating effect of two supply chain IS strategies – IS for Efficiency and IS for Flexibility – on the respective relationships between two SC strategies – Lean and Agile, and supply chain performance. Based on confirmatory analysis and structural equation modeling of survey data from members of senior and executive management in the purchase/materials management/logistics/supply chain functions, from 205 firms, we validate these hypotheses and show that the IS for Efficiency (IS for Flexibility) IS strategy enhances the relationship between Lean (Agile) SC strategy and supply chain performance. We also show a positive association between supply chain performance and firm performance, and a full (partial) mediation effect of supply chain performance on the relation between Agile (Lean) SC strategy and firm performance. The paper contributes to the supply chain literature by providing theoretical understanding and empirical support of how SC strategies and IS strategies can work together to boost supply chain performance. In doing so, it identifies particular types of supply chain IS application portfolios that can enhance the benefits from specific SC strategies. The paper also develops and validates instruments for measuring two types of SC strategies and supply chain IS strategies. For practice, the paper offers guidance in making investment decisions for adopting and deploying IS appropriate to particular SC strategies and analyzing possible lack of alignment between applications that the firm deploys in its supply chain, and the information processing needs of its SC strategy.

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    Bibliographic Info

    Article provided by Elsevier in its journal International Journal of Production Economics.

    Volume (Year): 147 (2014)
    Issue (Month): PB ()
    Pages: 340-350

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    Handle: RePEc:eee:proeco:v:147:y:2014:i:pb:p:340-350

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    Web page: http://www.elsevier.com/locate/ijpe

    Related research

    Keywords: Supply chain strategy; Information systems strategy; Supply chain performance; Information processing theory; Survey research;

    References

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    1. Gunasekaran, A. & Ngai, E. W. T., 2004. "Information systems in supply chain integration and management," European Journal of Operational Research, Elsevier, vol. 159(2), pages 269-295, December.
    2. Beamon, Benita M., 1998. "Supply chain design and analysis:: Models and methods," International Journal of Production Economics, Elsevier, vol. 55(3), pages 281-294, August.
    3. Li, Suhong & Ragu-Nathan, Bhanu & Ragu-Nathan, T.S. & Subba Rao, S., 2006. "The impact of supply chain management practices on competitive advantage and organizational performance," Omega, Elsevier, vol. 34(2), pages 107-124, April.
    4. Lai, Kee-Hung & Ngai, E. W. T. & Cheng, T. C. E., 2004. "An empirical study of supply chain performance in transport logistics," International Journal of Production Economics, Elsevier, vol. 87(3), pages 321-331, February.
    5. Gunasekaran, Angappa & Lai, Kee-hung & Edwin Cheng, T.C., 2008. "Responsive supply chain: A competitive strategy in a networked economy," Omega, Elsevier, vol. 36(4), pages 549-564, August.
    6. Vonderembse, Mark A. & Uppal, Mohit & Huang, Samuel H. & Dismukes, John P., 2006. "Designing supply chains: Towards theory development," International Journal of Production Economics, Elsevier, vol. 100(2), pages 223-238, April.
    7. Kyu Kim, Kyung & Yul Ryoo, Sung & Dug Jung, Myung, 2011. "Inter-organizational information systems visibility in buyer-supplier relationships: The case of telecommunication equipment component manufacturing industry," Omega, Elsevier, vol. 39(6), pages 667-676, December.
    8. Wang, Ge & Huang, Samuel H. & Dismukes, John P., 2004. "Product-driven supply chain selection using integrated multi-criteria decision-making methodology," International Journal of Production Economics, Elsevier, vol. 91(1), pages 1-15, September.
    9. Ketikidis, P.H. & Koh, S.C.L. & Dimitriadis, N. & Gunasekaran, A. & Kehajova, M., 2008. "The use of information systems for logistics and supply chain management in South East Europe: Current status and future direction," Omega, Elsevier, vol. 36(4), pages 592-599, August.
    10. Zhang, Cheng & Tan, Gek-Woo & Robb, David J. & Zheng, Xin, 2006. "Sharing shipment quantity information in the supply chain," Omega, Elsevier, vol. 34(5), pages 427-438, October.
    11. Kim, Soo Wook, 2009. "An investigation on the direct and indirect effect of supply chain integration on firm performance," International Journal of Production Economics, Elsevier, vol. 119(2), pages 328-346, June.
    12. Lin, Ching-Torng & Chiu, Hero & Chu, Po-Young, 2006. "Agility index in the supply chain," International Journal of Production Economics, Elsevier, vol. 100(2), pages 285-299, April.
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    Cited by:
    1. Chen, Liang-Tu, 2014. "Optimal dynamic policies for integrated production and marketing planning in business-to-business marketplaces," International Journal of Production Economics, Elsevier, vol. 153(C), pages 46-53.

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