Assessing the impact of business uncertainty on supply chain integration

Abstract

Purpose - The purpose of this paper is to investigate how business uncertainty affects the implementation of supply chain integration (SCI). More importantly, this research divides business uncertainty into four dimensions and SCI into three dimensions to examine the role of each dimension. In addition, it investigates the moderating effects of manufacturing approaches, such as push and pull, in the relationship between SCI and performance. Design/methodology/approach - Through a structured survey, this study collected 259 responses from supply executives, and supply and purchasing managers of US manufacturing firms. The empirical data analysis was done by using the partial least squares technique. Findings - The results empirically support the findings that business uncertainty positively affects implementation of SCI. Among the four dimensions of business uncertainty, dynamism and hostility significantly affect implementation of internal integration, integration with suppliers, and integration with customers. In addition, manufacturing approaches, such as push and pull, have a moderating effect on the relationship between SCI and performance. Practical implications - This study collected survey responses from a manufacturing firm in the supply chain to assist managers to find a solution while dealing with business uncertainty through the implementation of SCI. It also emphasizes manufacturing approaches, such as push and pull, in implementing SCI to improve performance. Thus, supply and purchasing managers should consider the business uncertainty that they are dealing with while developing their supply chain strategy. Originality/value - To the best of the authors' knowledge, this study is the first to provide meaningful insights on the effects of SCI toward dealing with business uncertainty. More importantly, by dividing the dimensions of business uncertainty and SCI, this study presents empirical evidence of the significant role of supply chain practices in uncertain business conditions. In addition, this study addresses the gap in extant literature and shows that managers need to consider their manufacturing approach in SCI to improve business performance.