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Lean Supply Chain Management Practices and Performance: Empirical Evidence from Manufacturing Companies

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The current study aims to investigate the effects of lean supply chain management (LSCM) practices on supply chain performance and market performance of manufacturing companies in Jordan. Five LSCM practices were identified based on an extensive literature review, namely, just-in-time system, flow of information, supplier relationship, customer relationship, and waste reduction. To achieve the study goals, a survey questionnaire was prepared and distributed to managers of 400 manufacturing companies from different industries and sizes. The final number of usable questionnaires was 308, representing a response rate of 77%. The results revealed positive and significant effects of three LSCM practices on market performance, namely, just-in-time system, flow of information, and customer relationship. In addition, all LSCM practices showed positive and significant effects on supply chain performance. Furthermore, supply chain performance demonstrated a positive and significant effect on market performance. This study is motivated by the fact that the effect of LSCM on performance is an under-investigated area in the literature. It contributes to the existing knowledge by identifying the most widely used LSCM practices and exploring their effects on supply chain performance and market performance of manufacturing companies in a developing country.
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Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
1
Lean Supply Chain Management Practices and
Performance: Empirical Evidence from
Manufacturing Companies
Haifa Abu Nimeh
#1
, Ayman Bahjat Abdallah
*2
, Rateb Sweis
#3
Department of Business Management, School of Business, The University of Jordan, Amman, Jordan
1
haifa.abunimeh@yahoo.com
2aymanabdallah@yahoo.com
3
rateb.sweis@gmail.com
Abstract
The current study aims to investigate the
effects of lean supply chain management (LSCM)
practices on supply chain performance and market
performance of manufacturing companies in Jordan.
Five LSCM practices were identified based on an
extensive literature review, namely, just-in-time
system, flow of information, supplier relationship,
customer relationship, and waste reduction. To
achieve the study goals, a survey questionnaire was
prepared and distributed to managers of 400
manufacturing companies from different industries
and sizes. The final number of usable questionnaires
was 308, representing a response rate of 77%.
The results revealed positive and significant effects of
three LSCM practices on market performance,
namely, just-in-time system, flow of information, and
customer relationship. In addition, all LSCM
practices showed positive and significant effects on
supply chain performance. Furthermore, supply
chain performance demonstrated a positive and
significant effect on market performance.
This study is motivated by the fact that the effect of
LSCM on performance is an under-investigated area
in the literature. It contributes to the existing
knowledge by identifying the most widely used LSCM
practices and exploring their effects on supply chain
performance and market performance of
manufacturing companies in a developing country.
Keywords
Lean supply chain management, Supply
chain performance, Market performance, Manufacturing
companies, Jordan.
1. Introduction
Markets are currently witnessing many changes,
such as intense competition, rapid innovations,
advances in manufacturing and information
technologies, and discerning customers.
The uncertainty related to have turbulent market
conditions and customer demand has increased the
necessity for adopting new competitive strategies
that increase the ability of manufacturing
companies to respond in an efficient and effective
manner to have a dynamic and interactive
environment. These realities have encouraged
manufacturers to look for advanced modes of
supply chains (SCs) that enable the transfer of
high-quality products in a short timeframe and
increase their competitiveness. Improving the
efficiency and effectiveness of SCs represents the
main challenge for manufacturing companies
aiming at sustaining and improving their
competitiveness. Lean management can be
incorporated into supply chain management (SCM)
to reduce the cost, delivery time, and improve the
effectiveness of SCs [1], [2]. Lean is increasingly
being used as a way to manage the SC and can
become a long-term philosophy for guiding
companies in the direction of high-class overall
performance [3], [4]. Currently, the implementation
of the lean SC approach has become a trend in the
global market and is one of the major strategies
being adopted by manufacturing companies.
Jordanian manufacturing companies are facing
considerable challenges in reacting to regional and
international competitors in terms of quality,
delivery, flexibility, and cost. These challenges
have become a reality due to free trade agreements
signed by the Jordanian government, which ended
the era of protection of local companies. In
addition, Jordan’s membership in the World Trade
Organization made the situation more difficult for
Jordanian manufacturers. It is worth noting that the
manufacturing inputs in Jordan are among the most
expensive regionally. Lean supply chain
management (LSCM) represents an optimal
strategy for Jordanian manufacturers to improve the
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International Journal of Supply Chain Management
IJSCM, ISSN: 2050-7399 (Online), 2051-3771 (Print)
Copyright © ExcelingTech Pub, UK (http://excelingtech.co.uk/)
Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
2
efficiency and flexibility of their operations and
SCs in an attempt to improve their market
performance.
Although the existing literature emphasizes the
essential role of LSCM in enhancing the
performance of manufacturing companies, there is
a lack of consensus on what practices constitute
LSCM. Furthermore, it is still unclear which
LSCM practices are expected to enhance SC
performance and market performance. Moreover,
the effect of LSCM and SC performance on market
performance have rarely been investigated in the
Middle East in general and Jordan in particular.
Therefore, the current study attempts to address the
gaps in the existing literature by investigating the
impact of LSCM practices on SC performance and
market performance, which will be investigated in
manufacturing companies in Jordan.
2. Literature Review
2.1
Lean Supply Chain Management
LSCM refers to the implementation of lean
principles across the entire SC [5]. Ref. [6] defined
LSCM as “a set of organizations directly linked by
upstream and downstream flows of products,
services, information and funds that collaboratively
work to reduce cost and waste by efficiently pulling
what is needed to meet the needs of individual
customers.” Researchers are increasingly paying
attention to the concept of LSCM as an effective
way to improve operations and eliminate waste
along the SC [7]. Early lean studies of [8] and [9]
indicated that lean management principles can be
applied across the SC. Lean SC means also
applying steps to eliminate all types of waste across
the SC, guided to minimize the production lead
time and SC-related costs [10]. Ref. [11] argued
that lean paradigms are deployed for the intention
of SC improvement and company performance.
Adopting LSCM yields several benefits including
greater manufacturing efficiency, reduced costs,
improved flexibility, and enhanced competitiveness
and success [12]. In addition, a lean supply chain
allows a smooth flow of products, information, and
technologies among supply chain partners without
waste [5]. Furthermore, [13] argued that LSCM is
integrated into upstream and downstream activities
that may reduce demand variation by simplifying,
optimizing, streamlining, and creating capabilities.
Moreover, manufacturing companies realized that
combining SCM with lean management could yield
superior performance outcomes [5].
Different practices have been used in the literature
to measure LSCM. [14] measured LSCM in terms
of setup time reduction, continuous improvement,
pull production, shorter lead time, and small lot
size. [15] measured LSCM in terms of customer
and supplier management, SC features,
communication and speed, and information
sharing. [16] considered four constructs to measure
LSCM practices, customer relationships, supplier
relationships, e-commerce, and enterprise software.
[17] used the following measures of LSCM, JIT
capabilities, participating in sourcing decisions,
geographical proximity of suppliers, information
sharing, improved integration, communicating
future strategic needs, and reduced response time.
[18] empirically validated four bundles of LSCM
practices, namely, elimination of waste and
continuous improvement, logistics management,
top management commitment, and customer-
supplier relationship management. Ref. [19]
determined the following LSCM practices, waste
reduction, process focus, continuous improvement,
customer focus, systems perspective, and
cooperative relationships. Ref. [11] determined the
following LSCM practices, supplier partnership,
JIT, pull flow, quality management, and customer
relationships. Ref. [20] used the following practices
for LSCM, customer relationship, supplier
development and partnership, JIT production, set-
up time reduction, concurrent engineering, and
design for manufacturing. Ref. [21] measured
LSCM in terms of supplier selection, pull
production, information technology, process focus,
and employee empowerment. Ref. [7] measured
LSCM in terms of JIT, total quality management,
human resource management, total productive
maintenance, manufacturing strategy, supplier
relationship management, and customer
relationship management.
Based on the reviewed studies, five LSCM
practices were defined as the most widely and
commonly used in the literature: JIT system, flow
of information, supplier relationship, customer
relationship, and waste reduction. These five
LSCM practices are discussed in the subsections
below.
2.1.1 Just-In-Time System
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JIT system is defined as an integrated SC strategy
incorporating defined elements of JIT-production,
JIT-purchasing, JIT-selling, with the addition of an
important new element, JIT-information [22].
Some of the JIT lean principles are inventory,
production, human resource, quality, and supplier
relation principles [23].
JIT system has been a key element in the
development of lean production in many companies
[24], [25]. In addition, lean production processes
require small-size deliveries from approved
suppliers, which helps to minimize inventory levels
and the associated inventory holding costs [26].
The benefits of implementing JIT system include
improved quality, increased responsiveness,
reduced cost, minimized inventory levels,
improved productivity, decreased lead time, and
reduced downtime [2], [27], [28]. Researchers
pointed to some barriers to JIT implementation
including absence of top management support, lack
of supplier training, lack of employee participation,
and local culture barriers [29], [7].
2.1.2 Flow of Information
Flow of information aims at acquiring and
diffusing information among SC partners in order
to improve decisions, operations, responsiveness,
and service levels [30]. Several researchers pointed
to information sharing as one of the main pillars in
SC and lean management [31], [32], [33]. [32]
further argued that sharing information with SC
partners can be a source of competitive advantage.
However, the impact of shared information
depends on how and when information to be shared
and with whom [33], [34]. In this vein, the benefits
of information sharing depends on the quality of
shared information [30], [35]. Quality of shared
information refers to accuracy, sufficiency,
timeliness, and truthfulness of exchanged
information which leads to enhanced SC
performance [36]. On the contrary, transfer of
distorted information will misguide SC members in
their decisions, resulting in wastes, thereby
affecting the coordination between the different
stages of a SC [37].
Shared information may include production
information, inventory levels, delivery and
shipment information, capacities, order quantities,
prices, point-of-sale, and competition information
[38].
2.1.3 Supplier Relationship
Supplier relationship refers to the ability of a firm
to establish, manage, and maintain long-term
reliable partnership with its suppliers [32]. It was
also defined as “the organizational practice of a
buying firm and its suppliers sharing and applying
operational, financial, and strategic knowledge in
order to generate mutual benefits” [39]. Supplier
relationship is expected to reduce costs and
increase trust levels [40], enhance responsibility
and improve technological and design capabilities
of SC partners [32], align capabilities and build
learning routines [41], and minimize or eliminate
wasted activities and time [42]. It also may include
integrated processes, long-term contracts, mutual
quality improvements programs, and risk and
reward sharing [43], [41].
2.1.4 Customer Relationship
Customer relationship is defined as a set of
activities related to building long-term relationships
with customers, managing customer complaints,
and enhancing customer satisfaction [32]. [44]
argued that customer relationship is a way of
obtaining information about products, market
needs, inventory, and operational processes from
the organizations’ clients. It was also defined as
“demand management practices through long-term
customer relationship, satisfaction improvement,
and complaint management” [45]. Customer
relationship involves different forms and activities
including integrated problem-solving initiatives,
establishing long-term relations with customers,
enhancing customer contacts, effective response to
customer complaints, and increasing customer
satisfaction [46], [47].
Different benefits of customer relationship have
been reported in the literature including increased
customer loyalty, improved problem-solving
process, enhanced knowledge and expertise
sharing, improved understanding of customer
needs, enhanced responsiveness to customers,
enhanced capacity to differentiate products, and
increased market share [37], [48].
2.1.5 Waste Reduction
[49] defined waste as any human activity which
absorbs resources but creates no value.” Waste was
also defied as “anything other than the absolute
minimum resources of material, machines, and
Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
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manpower required to add value to the product”
[50]. This includes any tasks performed by
organizations that consume resources without
adding value to the customer’s final product [51].
Waste reduction leads to optimized and simplified
processes along the entire SC [27].
The widely known types of waste are
overproduction, waiting, transport, unnecessary
motion, over-processing, defects, excessive
inventory, and unused employee creativity [52].
[53] pointed to four groups of office waste: people
waste, process waste, information waste, and asset
waste.
2.2 Supply Chain Performance
Researchers have investigated SCP from different
perspectives. [54] investigated SCP in relation to
product development strategy focusing on
efficiency. [55] measured SC performance in terms
of cost, flexibility, responsiveness, and
relationship. [56] used the measures of flexibility
and efficiency to measure SCP. [57] pointed to
efficiency and effectiveness as appropriate
measures of SCP. Similarly, [37] used efficiency
and effectiveness to measure SCP. In this study, the
widely used indicators of efficiency and flexibility
have been adopted to measure SCP.
Efficiency refers to the usage of minimum
resources and often is measured in terms of cost
and inventory turnover [37], [58]. Flexibility is a
key measure of SCP and is often regarded as a
reaction to environmental uncertainty [59]. It refers
to the ability of making available the products or
services to meet the particular customer demands
[60].
2.3 Market Performance
MP is a core construct of interest for researchers
concerned with any area of management. It is often
characterized in terms of the market share (e.g.,
market share growth) and sales indicators (e.g.,
sales volume, sales growth) of a company’s
products and services [61], [62]. [63] pointed to
comparative sales growth, market growth, and the
profitability as appropriate measures of MP. [64]
measured market performance in terms of customer
satisfaction, delivery reliability, and responsiveness
to customer needs. [65] used the measures of
customer satisfaction, profitability, and market
share and growth to reflect MP. In this study, the
indicators of market share, overall competitive
position, sales, customer satisfaction, and
profitability have been used to measure MP.
3. Theoretical Framework and
Hypotheses Development
3.1 Research Framework
This research is based on the framework proposed
in Figure 1. The framework depicts the effects of
LSCM practices on SC performance and MP. The
effect of SCP on MP is also proposed.
Figure 1. Research model
3.2 JIT System and Performance
JIT improves performance through reducing
inventory levels and operational costs, and
maximizing customer responsiveness [66]. In
addition, JIT techniques lead to reduced set-up time
and improved quality levels [67]. The
improvements in material flow accompanied with
reduced costs and improved quality will result in
improved SCP and MP [68]. Moreover, JIT
enhances the competitiveness of a firm and
increases customer satisfaction through meeting
their different requirements effectively and
efficiently [69]. The decreased inventories,
minimized defects and failures in the operational
processes, and enhanced ability to identify and
eliminate bottlenecks are expected to considerably
improve SCP [70]. [71] found that JIT system is
positively related to inventory turnover, cycle time,
Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
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and competitive performance. [72] found positive
effects of JIT on some measures of operational and
business performances.
H1. JIT is positively related to SCP.
H2. JIT is positively related to MP.
3.3 Flow of Information and Performance
Flow of information within internal organizational
units as well as with suppliers and customers
represents a source of competitive advantage [58].
Real-time information exchange with suppliers in
the upstream and with customers in the
downstream will create an opportunity for
optimizing operations and improving MP [73].
Ref. [32] asserted that sharing of the available data
with other SC partners can speed up the
information flow in the SC, enhance flexibility and
efficiency of the SC, and increase responsiveness to
changing customer needs. Ref. [74] indicated that
more information sharing leads to greater visibility
across the SC, and thus contributes to lower
inventory levels. Ref. [75] concluded that
information sharing within a SC could lower SC
costs considerably and reduce lead time through
reductions in inventories and shortages. In addition,
the rapid data and information transfer between an
organization and its partners results in increased
cooperation and efficiency [31]. Collaborative
planning activities and information sharing have
been found to have a positive effect on SCP, but
the quality of information shared and the level of
trust between the firms must be considered as well
[76]. Ref. [37] found that information sharing
positively related to SC efficiency and
effectiveness. Ref. [56] showed that information
sharing is positively related to SCP and MP. On the
other hand, [77] found no relationship between SC
information sharing and various measures of MP.
H3. Flow of information is positively related to
SCP.
H4. Flow of information is positively related to
MP.
3.4 Supplier Relationship and Performance
Within lean initiatives, close coordination with
suppliers enables the manufacturer to decrease
inventories, reduce business risks, enhance product
quality, and provide stable supply prices [21]. In
addition, supplier relationship leads to reduced
costs, improved quality, enhanced product design
with greater flexibility, increased information
sharing, and improved delivery performance [17].
Strategic supplier relationship enables
organizations to foster close working relationships
with key suppliers, promotes open communication
among SC partners, and leads to a long-term
strategic relationship orientation to achieve mutual
gains, which support customer responsiveness and
affect buying organizations’ MP and SCP [78].
Ref. [58] studied the relationship between SC
linkages and SCP and found that supplier
integration is highly related to reliable SCP. Other
empirical studies demonstrated that supplier
integration is positively related to different
performance measures [79], [80], [32], [81].
However, [82] found only weak relationships
between supplier collaboration and performance
improvement.
H5. Supplier relationship is positively related to
SCP.
H6. Supplier relationship is positively related to
MP.
3.5 Customer Relationship and
Performance
Customer relationship leads to long-term
partnership between an organization and its
customers founded on mutual trust and the ability
to meet customers’ needs, promote cooperation,
openness of communication, and a problem-sharing
attitude, leading thus to improved overall
performance [83]. A close and efficient customer
relationship allows an organization to sustain
customer loyalty, differentiate its products from
competitors, and extend the value it provides to
customers [84]. Furthermore, customer-focused
practices such as determining and communicating a
customer’s future needs, obtaining the customer’s
feedback, educating customers, providing after
sales services, and participating in the customer’s
marketing efforts are expected to improve MP and
SCP [85].
[86] found a direct positive effect of customer
relationship orientation on MP. [37] found a
positive effect of customer integration on SCP.
Other researchers found a positive effect of
Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
6
customer relationship on different performance
measures [87], [88], [33], [89].
H7. Customer relationship is positively related to
SCP.
H8. Customer relationship is positively related to
MP.
3.6 Waste Reduction and Performance
Achieving perfection through waste reduction is a
key aspect of a lean system through the elimination
of non-value-adding activities and other forms of
waste [52], [3]. Waste reduction can be achieved
through the implementation of lean principles,
which includes assessing the current situation and
designing a production system based on lean
system concepts and techniques [9]. Organizations
that apply waste reduction strategy can lower
operational and SC related costs including waste
management costs, hazardous material
management costs, time and costs for reporting, as
well as savings from conserving energy, water,
fuel, and other resources, which positively will
affect SCP and MP [90]. Waste reduction decreases
the requirements for resources while maintaining
increasing output levels. Waste reduction
contributes to improving SC performance by
streamlining processes and increasing process
consistency [91]. [92] found a positive relationship
between waste elimination and the maximization of
productivity of manufacturing organizations.
H9. Waste reduction is positively related to SCP.
H10. Waste reduction is positively related to MP.
3.7 SCP and Market Performance
The purpose of SC improvements is to improve MP
dimensions including profitability, market share,
and customer responsiveness [93]. MP will be
improved as a result of using optimum capabilities
of SC partners [45], eliminating the inefficiency
along the SC [93], enhancing flexibility to
responding to unexpected customer needs and
requirements [94], and increasing the relationship
effectiveness [32]. In addition, SCP positively
affects MP through the enhanced coordination of
critical activities across the SC [95]. Improved SC
flexibility enables switching production among SC
partners, increasing thus, the ability to cope with
variability in customer demand and leading to
enhanced MP [96]. Ref. [97] argued that the
benefits of applying SCM will be reflected in the
short term in the form of improved SCP. They
further indicated that the improved SCP will lead to
increased MP in the long run.
Ref. [97] using a sample of 211 companies in the
USA found that collaborative advantage (SCP) is
positively and significantly related to business
performance. Ref. [95] using a sample of 474
manufacturing managers in the USA found that
SCP positively affects MP. Ref. [32] using a
sample of 196 companies in the USA found that
SC-related competitive advantage positively and
directly related to organizational performance. Ref.
[93] using a sample 231 responses from the
Australian food and hardware retailing firms found
that SCP positively affects customer
responsiveness and financial performance.
H11. SCP is positively related to MP.
4. Methodology
4.1 Sample
The research population consisted of all
manufacturing companies operating in the capital
city of Amman, Jordan. The total number of
manufacturing companies in Amman is 1200 [98].
The appropriate sample size for this population is
292 [99]. The unit of analysis is a manufacturing
plant. Convenience sampling was used to select the
targeted manufacturing companies. One respondent
representing each company’s management was
targeted. To achieve the targeted sample size, 400
questionnaires were distributed by the researchers
to the companies. The targeted respondents were
managers whose responsibilities are related to
SCM. These included general managers, deputy
general managers, operations managers, SC
managers, plant managers, and others. The
surveyed companies were selected from different
industries to ensure the diversity of the sample. The
surveyed companies included electrical, chemical,
food, electronics, pharmaceuticals, plastic and
rubber, and others. Three hundred forty-one
questionnaires were completed by the respondents,
and 33 questionnaires were excluded because of
missing data. Thus, the final number of usable
questionnaires is 308, representing a response rate
of 77%. This rate is considered acceptable
compared with other empirical studies in Jordan
that used personal visits approach to collect the
Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
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data. For instance, [100] received a response rate of
69%, [101] received a response rate of 80.6%, and
[102] got a response rate of 64.3%.
4.2 Questionnaire and Measures
A survey questionnaire was prepared to collect the
data. The items included in the survey were
adapted from the existing literature. The survey
was first prepared in English language and then
translated into Arabic. Both versions were
reviewed by five professors in Operations and
Supply Chain Management. Based on the received
feedback, revisions were made as needed.
Additionally, the survey was pre-tested by five
managers from different companies to check the
understandability of the question items and the
needed revisions were made.
JIT construct included six items and was adapted
from [68] and [22]. Flow of information construct
included eight items and was adapted from [32] and
[103]. Supplier relationship construct included
seven items adapted from [58], [56], and [104].
Customer relationship included seven items
adapted from [103] and [104]. Waste reduction
construct included seven items adapted from [27]
and [22]. SCP construct included 16 items adapted
from [105], [84], and [56]. Finally, MP construct
included five items adapted from [32] and [84].
Respondents were asked to indicate their agreement
or disagreement with the statements provided using
5-point Likert scale where 1 indicated strongly
disagree and 5 indicated strongly agree. Items
related to MP require respondents to evaluate their
performance as compared to their competitors in
the same industry during the last three years.
4.3 Measurement Validity and Reliability
Exploratory factor analysis (EFA) was applied to
evaluate the validity of the research constructs.
Principal component analysis and the promax
rotation method were selected to run the analysis.
All the items were entered simultaneously, and as
was initially expected, seven distinct factors
resulted. Items that loaded onto one factor with
item loadings greater than 0.40 were retained [106].
Twenty three items did not meet this criteria and
were deleted. The large number of deleted
questions could be attributed to adapting the items
for most constructs from different sources. In
addition, SC question items tend to be highly
correlated, and this may resulted in cross-loadings
of many items. Eigenvalues for the seven
constructs were greater than one.
To test the reliability of the constructs, Cronbach’s
α
-coefficient was applied. Alpha values ranged
between 0.796 and 0.935 indicating reasonable
internal consistency [106].
Based on EFA results, confirmatory factor analysis
(CFA) was run using Amos 20. The objectives of
running CFA were to ensure that all the item
loadings were greater than 0.50 and were greater
than twice their standard errors so that to provide
support for convergent validity, to ensure that the
average variance extracted (AVE) value for each
construct was above 0.50 to further support
convergent validity, to verify that the composite
reliability value for each construct was above 0.70
to provide a satisfactory evidence of reliability, and
to confirm that the model fit indices were within
the recommended values [107], [108], [109]. Ten
additional items were deleted to meet these values.
The final model fit indices fitted the data
reasonably well (X
2
= 589.219; d.f. = 209; X
2
/d.f. =
2.819; CFI = 0.922; GFI = 0.891; NNFI = 0.917;
and RMSEA = 0.069). The normed chi-square of
2.819 is less than the maximum value of 3.0 [110].
The comparative fit index (CFI) and non-normed
fit index (NNFI) are greater than the recommended
minimum values of 0.90 [107]. The goodness-of-fit
index (GFI) is slightly below the recommended
minimum value of 0.90 [107]. The root mean
square error of approximation (RMSEA) is 0.069
indicating acceptable model fit [107], [111]. Table
1 shows means and standard deviations of study
constructs, the standardized factor loadings of
CFA, Cronbach’s alpha values, and composite
reliability for the final constructs.
Discriminant validity was evaluated by ensuring
that the square root of each AVE value of each
construct is higher than the absolute correlation
values between that construct and other constructs.
All the constructs met this criterion, providing
reasonable support for discriminant validity [108].
Moreover, the AVE value for each construct was
greater than the maximum shared squared variance
(MSV) and average shared squared variance (ASV)
values for that construct as shown in Table 2,
providing additional support for discriminant
validity [106].
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Table 1.
Reliability and validity of the constructs
Table 2.
Discriminat validity
Construct Item
number Mean Standard
deviation Loadings
CFA Cronbach’s
alpha Composite
reliability
JIT 4.25 0.681 0.796 0.789
JIT5 0.789
JIT6
0.840
FI
3.94 0.661
0.811
FI1
0.738
FI2
0.765
FI3 0.799
SR 3.84 0.795 0.847 0.858
SR5 0.795
SR6 0.902
SR7 0.751
CR 4.04 0.760 0.843 0.845
CR1
0.694
CR2
0.872
CR4
0.837
WR
4.28 0.659
WR1 0.826
WR2 0.861
WR3 0.950
SCP 3.95 0.682 0.869 0.882
SCP3 0.739
SCP4 0.769
SCP5
0.759
SCP10
0.837
SCP14
0.765
MP
3.99 0.961
MP1 0.917
MP2 0.937
MP3 0.907
MP5 0.791
Construct AVE MSV ASV 1 2 3 4 5 6 7
1. JIT 0.664 0.227 0.153 0.815
2. FI 0.589 0.477 0.310 0.408 0.768
3. SR 0.670 0.651 0.325 0.254 0.691 0.818
4. CR 0.648 0.631 0.374 0.448 0.675 0.795 0.805
5. WR 0.775 0.294 0.135 0.276 0.238 0.542 0.448 0.881
6. SCP 0.600 0.484 0.321 0.429 0.631 0.596 0.696 0.426 0.775
7. MP 0.792 0.323 0.203 0.476 0.553 0.332 0.499 0.063 0.568 0.890
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5. Results
Study hypotheses were tested using structural
equation modeling with Amos 20. The results show
that the effects of all LSCM practices on SCP are
positive and significant, therefore hypotheses H1,
H3, H5, H7, and H9 are supported. As for the
effects of LSCM practices on MP, three practices,
JIT, flow of information, and customer relationship
show positive and significant effects, therefore
hypotheses H2, H4, and H8 are supported. The
effects of supplier relationship and waste reduction
on MP are negative and significant, therefore
hypotheses H6 and H10 are not supported. Finally,
the effect of SCP on MP is positive and significant,
therefore hypothesis H11 is supported. Table 3
provides summary of the tested hypotheses.
Table 3.
Summary of results
6. Discussion and Conclusion
6.1 Discussion
The findings of the study showed significant and
positive effects of three LSCM practices, namely
flow of information, JIT, and customer relationship
on MP. This confirmed earlier findings on the
presence of positive effects of these practices on
MP [32], [66], [86], [89].
The exchange of high-quality information between
partners improves the coordination and
responsiveness of the partnership and ultimately
MP, such as sales growth, market development, and
product development [73], [112]. Furthermore, the
sharing of information across the SC will lead to
closer integration, which improves productivity,
customer service, and MP. This implies that timely
and accurate information can be a source of
competitive advantage. JIT proved to be one main
driver of MP in manufacturing companies. JIT is a
major component of LSCM, and a comprehensive
implementation of this strategy is expected to
contribute to organizational performance and may
provide manufacturing companies with a
competitive advantage [66]. Customer relationship
is also essential LSCM practice that can
considerably improve MP. Such relationship is
expected to improve quality, flexibility, and
delivery performance. It also enhances the
company’s responsiveness to its customers
increasing, thus, their satisfaction. Manufacturing
companies should focus on building long-term
relationships with key customers in order to avoid
any future problems and timely respond to their
complaints and requirements. On the one hand, the
findings of this study showed negative significant
effects of supplier relationship and waste reduction
on MP. These results are inconsistent with some
previous studies [92], [81], [80], [32], [90]. The
result regarding supplier partnership could be
attributed to the fact that most Jordanian
manufacturers rely on international suppliers, and
cultural differences seem to inhibit the exploitation
of expected market benefits of the relationship. The
negative effect of waste reduction on MP could be
attributed to the fact that waste reduction efforts
Hypothesis Path Standardized regression
W
eights
p-value Result
H1 JIT
SCP 0.122 0.017 Supported
H2 JIT
MP 0.264 0.000 Supported
H3 FI
SCP 0.397 0.000 Supported
H4 FI
MP 0.276 0.000 Supported
H5 SR
SCP 0.134 0.015 Supported
H6 SR
MP - 0.104 0.030 Not supported
H7 CR
SCP 0.349 0.000 Supported
H8 CR
MP 0.224 0.000 Supported
H9 WR
SCP 0.207 0.000 Supported
H10 WR
MP - 0.246 0.000 Not supported
H11 SCP
MP 0.312 0.000 Supported
Int. J Sup. Chain. Mgt Vol. 7, No. 1, February 2018
10
reflect operational and SC improvements that are
expected to improve SCP, but it seems that these
improvements are not perceived by customers.
Moreover, waste reduction efforts require
resources, training, and time to succeed, and this
may negatively affect profitability and MP in the
short-term.
The results revealed a significant positive effects of
all LSCM practices on SCP. This is in line with
previous literature [37], [68], [58], [80], [70], [88],
[32]. LSCM represents an ideal strategy for
manufacturing companies to improve their SCP.
The expected benefits may include reduced costs,
improved quality, faster delivery, and enhanced
flexibility. In addition, LSCM practices can provide
solutions to reduce lead times and improve
responsiveness to demand variability.
Finally, the results showed that SCP is positively
related to MP. This is consistent with previous
literature examining this relationship [97], [95],
[32], [93]. This indicates that SCP is an essential
indicator of MP for manufacturing companies in
today’s dynamic and competitive environment.
Companies seeking improvements in their MP
should not focus solely on internal improvements,
but rather should pay considerable attention on
improving their SCP through adopting LSCM
practices.
6.2 Conclusion
This study developed a theoretical framework to
investigate the effects of LSCM practices on SCP
and MP performance in Jordanian manufacturing
companies. Additionally, the effect of SCP on MP
was investigated.
The results revealed that three LSCM practices,
namely, JIT system, flow of information, and
customer relationship positively affected MP.
Jordanian manufacturing companies should
increase their implementation levels of these
practices in order to enhance their MP. Supplier
relationship and waste reduction did not show
positive effects on MP.
The findings demonstrated that all LSCM practices
positively affected SCP. Managers in
manufacturing companies should pay considerable
attention to LSCM as a winning strategy to
improve SCP. In addition, SCP proved to positively
affect MP.
All in all, the overall conclusion is that LSCM
practices are critical to improve SCP and MP. In
today’s competitive and dynamic environment,
manufacturing companies, especially in the
developing countries, have to increase their
competitiveness through the adoption of LSCM.
6.3 Limitations and Future Research
Although this study reached some important
findings, it has some limitations that can be
addressed in future research. First, this study used
only five practices of LSCM. Future studies could
employ other practices to explore their effects on
SCP and MP. Second, data were collected from
manufacturing companies representing mainly the
buying firms. Data from suppliers and key
customers could have provided better
understanding of LSCM practices and their effects
on SCP and MP. Future studies should tackle the
opinion of SC partners to provide deeper insights
on LSCM. Third, the study included only
manufacturing companies, so the results cannot be
generalized to other sectors. Future studies should
investigate the proposed effects in service
organizations such as hospitals.
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... SCP is regarded as the fundamental driver of business performance and competitive advantage (Abdallah et al., 2021;Dellana et al., 2019;Delic and Eyers, 2020;Huo et al., 2014;Qrunfleh and Tarafdar, 2014). By improving the efficiency and effectiveness of the SC, manufacturing companies can increase their responsiveness to the local and international customers, while also allowing them to meet the changing needs and requirements of their customers effectively, reduce lead times, improve the delivery and flexibility performances, and reduce transportation and inventory costs (Abdallah et al., 2014;Abu Nimeh et al., 2018). ...
... This depends on the suppliers' technical capabilities, as well as on the objective of involving and integrating suppliers (Johnsen, 2011). There are several benefits of supplier integration such as cost reduction, enhanced trust, shared responsibility, taking advantage of supplier's technologies and competencies, improved product design, reduced design cost, minimized or eliminated waste, improved competitive advantage and enhanced overall performance (Abdallah and Al-Ghwayeen, 2019;Abu Nimeh et al., 2018;Li et al., 2006;Yang and Wei, 2013). 2.1.2 ...
... Different measures have been conceptualized and used in the literature to measure SCP. These include quality improvement, cost reduction, delivery punctuality, reduction in lead times, process improvement, flexibility, customer responsiveness and time-to-market (Abu Nimeh et al., 2018;Al-Shboul, 2017;Katiyar et al., 2018;Mani et al., 2018;Panayides and Lun, 2009;Seo et al., 2014;Sundram et al., 2016). In line with previous studies, the current study measures SCP using the indicators of cost, quality, delivery, flexibility, lead time, responsiveness and time-to-market. ...
Purpose The purpose of this study is to examine the effect of supply chain integration (SCI) in terms of supplier, customer and internal integration on supply chain performance (SCP) and export performance (EXP). The effect of SCP on EXP is also explored. This study further seeks to examine the mediating effect of SCP on the relationship between the types of SCI and EXP. Design/methodology/approach The population of this study consists of manufacturing companies in different industries in Jordan. Data were gathered using self-administered questionnaires; managers from 271 companies responded to the survey. The study constructs were assessed for validity and reliability, and it was ensured that acceptable levels of these tests were obtained. Structural equation modeling (SEM) was used to test the study hypotheses. Findings The findings showed that supplier and customer integration were not drivers of EXP, but internal integration positively impacted EXP. In addition, internal and customer integration positively affected SCP, while supplier integration did not. Also, SCP positively impacted EXP. Furthermore, customer integration and internal integration indirectly impacted EXP through SCP. Practical implications Manufacturers should establish both intra- and inter-organizational collaborations to improve their performance. Specifically, managers in developing countries need to pay substantial attention to internal integration, as it is the key antecedent of both SCP and EXP. Furthermore, managers must be aware of the essential role of customer integration in improving SCP and subsequently EXP. Therefore, they should make long-term plans to integrate and incorporate key customers. In addition, managers are advised to reconsider their current relationships with suppliers. By failing to take advantage of the valuable expected contribution of supplier integration, manufacturers may lose export opportunities to international competitors. Originality/value The present study addresses an evident gap in the available literature regarding the effect of SCI on EXP. It tests a comprehensive model underlining the role of SCP on the relationship between SCI types and EXP. This study is also valuable because it was conducted in a developing country. Generally, manufacturing companies in developing countries face more SC-related difficulties than those in developed countries; these challenges can limit the export abilities of manufacturers in developing countries. The study offers important implications for the managers of manufacturing companies to improve their SCP and, subsequently enhance their EXP.
... Therefore, the firms also should raise their SP. On the other hand, this analysis of practices LSCM should be addressed from both a company's point of view and a supply chain's point of view (Nimeh et al., 2018). Thus, the perspective of inter-organisational operations was identified to propose in new challenges opportunities for future research. ...
... Many studies are focusing on how companies may integrate their processes with customers and suppliers, as well as how LSCM practices should be aligned with the mission of the organization (Qrunfleh & Tarafdar, 2014;Nimeh et al., 2018;Iranmanesh et al., 2019). The companies can achieve a more successful implementation by eliminating unnecessary or even contradicting efforts in the implementation of LSCM practices as a result of this identification. ...
... The difference between success and failure in reaching the sustainable performance of SCM implementation may be explained by LSCM practices. Particularly, Manufacturing companies in the developing countries must enhance their competitiveness by using LSCM in competitive and dynamic markets (Marodin et al., 2017;Nimeh et al., 2018). In other word, the organizations have used LSCM practices within value added to the products include waste reduction and minimize inventory (Mallak et al., 2018;Qrunfleh & Tarafdar, 2013;Wen Chiet et al., 2019). ...
... Ref [16] affirms that a well-performing Supply Chain is critical for achieving the strategic objectives and goals of government institutions; as a result, SCP is embedded in the SA Supply Chain Management (SCM) framework [15]. In their works, [17], [18], [19], [20] and [21] recognised SCP measurement as an essential element for the improvement of organisational performance. ...
... The strategy mapping process clarifies the performance measurement process's inputs, outputs, and outcomes. SCP measures should be coherent with the SOE's corporate strategies, goals and objectives and socio-economic imperatives [28] and [17]. ...
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State-Owned Entities in South Africa remain the major contributor toward socioeconomic objectives, the bottom line, quality, value creation and cost savings. Although the National Treasury's Office of the Chief Procurement Officer monitors and evaluates supply chain performance, there is inefficient guidance on executing supply chain performance measurements in state-owned entities. Therefore, this paper aims to suggest a supply chain performance framework suitable for State-Owned Entities in South Africa. The manuscript employs a theoretical literature review on supply chain performance measurement systems and associated metrics. Further study using mixed methods or qualitative research is recommended to understand better the connection between supply chain strategy, SCM regulatory frameworks, SCM practices, and SCM effectiveness. The paper presents a framework that adequately implements supply chain performance measurement in state-owned entities. The study's main limitation was that it was restricted to SOEs registered with the SOEPF; more extraordinary samples from various SOEs would have been ideal. It is recommended that supply chain managers in state-owned entities carefully select supply chain performance measures.
... The importance of SCA has become more noticeable for manufacturing firms, and their partners to enable them to react quickly and effectively in meeting customer requirements in a constantly changing marketplace (Nimeh et al., 2018;Blome et al., 2013). Though the textile sector is one of the major sectors of Pakistan involved heavily in export activities, very little literature is found on the topic primarily related to SCA and its effect on export performance. ...
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Full-text available
Purpose This study aims to examine the effect of supply chain agility (SCA) on the export performance of the Pakistani textile industry. Despite being one of the leading manufacturing and exporting sectors, only a handful of the extant literature is found on the textile industry. Design/methodology/approach A structured questionnaire was prepared using the extant literature. Data was gathered from 146 respondents associated with the textile industry of Pakistan. Hypotheses were tested using structural equation modeling after ensuring the reliability and validity of the data collected for this study. Findings This study provides several crucial insights for export-oriented firms. International entrepreneurial orientation and domestic competition are the crucial drivers for a firm’s agility. This study confirms that SCA has a significant impact on escalating export performance of the Pakistani textile industry in the international market. Originality/value To the best of the authors’ knowledge, the theoretical framework developed for this study is original and drawn from the extant literature. The findings of resulted from empirical testing of the theoretical model in the context of developing countries provide new information in the knowledge body.
... Therefore, to deal with changing market conditions, SCM must have a reliable analysis tool that is able to adapt to supply chain variables in the field (Salah et al, 2011). Lean implementation is a way to deal with waste in the supply chain and can maximize production, so that the efficiency of the production process will be obtained, reduced costs, greater flexibility, and increased competitiveness (Nimeh et al, 2018). The use of lean in supply chain distribution allows the system to be more optimal and efficient, meeting customer demand, supply to customers, and of course with minimum waste (Arif-Uz-Zaman and Ahsan, 2014). ...
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Supply Chain Management (SCM) is a very dynamic upstream to downstream distribution system that aims to produce a service, a better product, and a minimum cost. To achieve this, there are new concepts for the development of SCM, namely Lean Supply Chain (LSC), Supply Chain Quality Management (SCQM), and Supply Chain Network Design. Where LSC applies lean to address waste in the distribution chain, maximizing production, so costs will be reduced, and competitiveness will increase. Whereas SCQM in its application has the term internal dimension, namely quality management and external dimension, namely the context of supply chain management. Then for supply chain network design is a technology that can support the development of SCM to realize the connectivity and integration of distribution data so that all parties must feel benefited, both the producers, the shipping service, and the end users.
... LP are used to minimize wastage from processes; on the other hand, supply chain agility (SCA) is essential for a critical firm and change according to the varying needs of customers. SCA is considered a key source of efficient and rapid response to the dynamics of the market for manufacturing firms to meet the demands of customers (Nimeh et al., 2018). ...
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Purpose In today's global economy, developing supply chain agility (SCA) and lean practices (LP) as resource-based view and dynamic capabilities are essential for firms to sustain their competitive advantage (CA) and enhance their operational performance (OP). The purpose of this paper is to develop and empirically test a framework to investigate how CA is achieved through SCA and LP and how these, in turn, can enhance a firm's OP. Design/methodology/approach For data collection, the authors adopted the survey method using self-administered questionnaires. Two-source survey data were collected in two rounds (separated by a two-month lag time) from supply chain managers, operational managers and general managers. The purpose of collecting data in two rounds was to reduce common-method bias. Likert scale (1–5) was used in the questionnaire. Smart PLS 3 and SPSS 23 were used for the data analysis purpose. Findings SCA was found to directly and positively affect OP. LP also positively affected OP. In addition, CA fully mediated the relationship between SCA, LP and OP. Practical implications This study encourages the managers of manufacturing firms to adapt LP and their supply chains (SCs) to become agile and leverage the advantages of their implementation to improve their OP and succeed in the market. Originality/value This study is one of the first to investigate the effect of SCA and LP on OP. Furthermore, the first study examines CA's mediating impact on the relationship between SCA, LP and OP.
... Firms' relationship with their suppliers and customers create tangible and intangible assets which are subsequently leveraged toward creating competitive advantage. The link between supplier relationship management and performance has been empirically observed in different industries including manufacturing (Hong, Zhang, & Ding, 2018;Nimeh, Abdallah, & Sweis, 2018), automotive (Han, Huang, & Macbeth, 2018) and construction (Sindiga, Paul, & Mbura, 2019). Also, the effect of customer relationship management on customer satisfaction which subsequently results in competitive advantage has been empirically tested in other sectors (Haislip & Richardson, 2017;Soltani, Zareie, Milani, & Navimipour, 2018). ...
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The competitiveness and growth of the hotel industry have propelled a lot of interest by researchers. Premised on the resource-based view, dynamic capability and competitive advantage theories, this paper investigated the effect of managing supplier and customer relationships on the competitive advantage and performance of hotels. Questionnaires were distributed to managers of one-star rated hotels in the Central and Western regions, and data was analyzed with partial least squares structural equation modeling (PLS-SEM). Analysis of the hypothesized relationships revealed that management of customer relationships had a significant and positive effect on competitive advantage; however, supplier relationship management did not. Again, both supplier relationship management and customer relationship management had no direct effect on the operational performance of hotels. Further, the study confirmed that competitive advantage influences the operational performance of hotels. A mediation test through the bootstrapping procedure revealed that competitive advantage fully mediates customer relationship management and operational performance relationship. The study contributes to the resource-based view and competitive advantage literature and draws implications for practice by hotel managers. It is recommended that the management of hotels maintain a balanced relationship with customers and suppliers.
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Due to the globalization of markets world over, supply chain management practices have become conduits for high marketing performance for business organizations. This study examined the influence of supply chain management practices on marketing performance of Boutiques in Port Harcourt. A quantitative and causal research design was adopted to take on board the four (4) hypotheses formulated for the study. The population of this study consists of eight hundred and eighty-nine (889) registered Boutiques in Port Harcourt, whose authentic list was derived from the Business Directory of the Rivers State Ministry of Commerce and Industry, and sample size of two hundred and sixty-nine (269) was attained with the Krejcie and Morgan table. A self-structured questionnaire designed in the five-point Likert scale was used to obtained primary data from five hundred and thirty-eight (538) respondents (key informants; sales representatives and customer relationship managers), purposely chosen from the selected two hundred and sixty-nine (269) Boutiques, through a cross-sectional survey. The face validity of the questionnaire was established by professionals consisting of scholars and business practitioners with adequate knowledge of the subject matter. The construct and content validity were confirmed from previous researchers who used it, with slight adjustments. The research hypotheses were tested with the simple regression technique with the aid of Statistical Package for Social Sciences (SPSS) version 22.0. The results show that strategic supplier partnership has a very strong, significant and positive influence on customer patronage and brand awareness, and information sharing has a strong, significant and positive influence on customer patronage and brand awareness. The study therefore concludes that supply chain management practices positively and significantly influence marketing performance of Boutiques in Port Harcourt. Therefore, the study recommends that the management of Boutiques in Port Harcourt should scrutinize their supply chain management practices and ensure incessant modernization of strategic supplier partnership and information sharing in order to enhance their marketing performance.
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Purpose This study aims to comparatively discuss the effect of lean manufacturing (LM) implementation in the manufacturing sectors of developing and developed countries. Design/methodology/approach An in-depth literature review focused on previous research published between 2015 and March 2020. The papers published by the databases such as Google Scholar, Scopus, ProQuest and Web of Science were used in the study. A total of 63 studies that focused on LM application in manufacturing industries in developing and developed countries were used in the research. Findings It was observed that LM improves operational performance for manufacturing organizations in developing and developed countries. Small and medium-sized enterprises in both developed and developing countries have difficulties transforming their organizations into lean organizations compared to large enterprises. Furthermore, the review also found that there seems to have been no paper had reported the negative impact of implementing LM in manufacturing industries in developing and developed countries from 2015 to March 2020. Research limitations/implications The study used research papers written between January 2015 and March 2020 and only considered manufacturing organizations from developed and developing nations. Practical implications The study provides more insight into LM implementation in developing and developed countries. It gives the LM practices and the implications of applying these practices in manufacturing organizations for developing and developed countries. Originality/value A preliminary review of papers indicated that this seems to be the first paper that comparatively studies how LM implementation has affected manufacturing organizations in developed and developing countries. The study also assessed the LM practices commonly used by the manufacturing industries in developing and developed countries.
Article
Purpose The purpose of the current study is to address a debatable issue in the extant literature regarding lean management (LM), innovation and operational performance (OP) relationships in the manufacturing SMEs. It conceptualizes LM in terms of social and technical aspects and investigates their effects on process innovation, management innovation and OP. The mediating roles of process and management innovations on social/technical-OP relationships are also explored. Design/methodology/approach The study analyzes survey data gathered from 268 manufacturing SMEs belonging to different industry types in Jordan. Validity and reliability tests of the first and second order constructs were performed. Structural equation modeling (SEM) was used to test the study hypotheses. Findings Both social and technical LM were found to positively affect OP. Social LM positively affected both process and management innovations. However, the effect of technical LM on both types of innovation was not significant. In addition, process and management innovations positively mediated social LM-OP relationship. Nonetheless, neither type of innovation showed mediating effects on technical LM-OP relationship. Originality/value This study is one of the first to highlight the proposed relationships, in general, and in the context of SMEs in a developing country context, in particular. It offers important implications for the managers of SMEs to benefit from LM implementation and avoid its failure, enhance innovation efforts by focusing on social LM practices and subsequently achieve higher levels of OP.
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Purpose – The purpose of this paper is to investigate the effect of supply chain integration (SCI) in terms of supplier integration, customer integration, and internal integration on knowledge management (KM) and technical innovation (TI). The study also investigates the effect of KM on TI. Furthermore, the mediating effect of KM on the relationship between SCI and TI is investigated. Design/methodology/approach – Study model and hypotheses were developed based on literature review. The study is based on survey data collected from 217 Jordanian manufacturing companies in electrical, electronics, machinery, and mechanical appliances industries. Exploratory factor analysis and confirmatory factor analysis were applied to assess construct validity. Direct and indirect effects were tested using structural equation modeling and bootstrap re-sampling technique. Findings – The results reveal that supplier integration and customer integration have positive effects on KM and TI, while internal integration has not. Also, KM has a positive effect on TI. In addition, KM mediates supplier integration-TI and customer integration-TI relationships, while does not mediate internal integration-TI relationship. Originality/value – Most existing studies examined the effect of KM on SCI and supply chain management. This study argues and empirically demonstrates that SCI contributes to KM capability of manufacturing companies. Moreover, this is one of the first studies to investigate the mediating role of KM on SCI-TI relationship. The paper provides evidence that external integration is superior to internal integration in enhancing KM and TI. Keywords Technical innovation, Customer integration, Knowledge management, Supply chain integration, Supplier integration Paper type Research paper
Article
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Purpose The purpose of this paper is to investigate the effects of knowledge management (KM) on product and process innovations, as well as on operational performance (OP). In addition, the effects of product and process innovations on OP, as well as their mediating effects on the relationship between KM and OP, are also investigated. Design/methodology/approach A questionnaire-based survey was designed and used to collect data from 207 manufacturing companies operating in the Jordanian capital Amman. To assess construct validity, exploratory and confirmatory factor analyses were conducted. To test research hypotheses, the bootstrap re-sampling method was applied using Hayes’s SPSS multiple-mediator PROCESS macro. Findings The results indicate that KM has significant positive effects on product and process innovations, and OP. Process innovation was found to have a significant positive effect on OP, while product innovation was not. Furthermore, only process innovation was found to significantly mediate the KM-OP relationship. Practical implications The findings of this study provide useful insights about the role of KM in facilitating and enhancing product and process innovations, as well as OP in the surveyed manufacturing companies. An important implication concerns the roles of product and process innovations. Manufacturing companies seeking improvements in their OP are recommended to focus on process innovation rather than product innovation. While product innovation may affect other aspects of performance, such as market and financial ones, it was not found to significantly affect OP. Process innovation can also leverage KM’s contribution to manufacturing companies’ OP. Originality/value This is a pioneering study in that it developed an integrated model that depicts the interrelationships among KM, product innovation and process innovation and OP, in a developing country context.
Article
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Understanding the various effects that exist among intellectual capital, knowledge sharing, and organizational performance is the main purpose of this study. Data were gathered from 356 employees working in manufacturing companies in Jordan. In order to test the hypotheses of this study, the approach suggested by [1] was undertaken. The results of the analysis revealed that intellectual capital had a positive effect on organizational performance and knowledge sharing. The results also showed that knowledge sharing had a positive effect on organizational performance. Finally, it was found that knowledge sharing had a positive mediating effect on the relationship between intellectual capital and organizational performance. The findings of this study thus provide many benefits for researchers and practitioners despite the presence of some limitations.
Article
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Purpose – The purpose of this paper is to employ a newly developed framework to examine the complex relationship between different components of supply chain practices, supply chain integration (SCI) and supply chain performance (SCP) in the Malaysian electronics sector. Design/methodology/approach – This study utilizes survey data of 156 electronics firms in Malaysia and tested the research framework and hypotheses. In addition to the traditional approach of Barron and Kenny (1986), the Sobel test as well as a bootstrapping approach, which is deemed for small sample size, is used to formally test the indirect effects of SCI in the model. Findings – SCI has fully and partially mediated the relationship between supply chain management practices (SCMPs) and SCP. SCI fully mediates the relationship between SCP and three of the SCMPs, namely, information quality, agreed vision and goals and postponement strategies. The relationship of supply strategic partnership, customer relation management, information sharing with SCP were partially mediated by SCI. Risk and reward sharing is found to be non-significant. These insights allow managers to effectively utilize the different components of SCMPs for SCI and performance. Practical implications – For supply chain practitioners, the results of the study can be useful in integrating SCMPs and SCI on improving SCP. Practitioners should take into account the mediating effect of SCI in designing their supply chain management approach to production. Originality/value – To the authors’ best knowledge, this paper is one of the first to address the mediating effect of SCI between SCMPs and overall performance of the supply chain.
Article
Purpose – For decades multiple management philosophies directed toward lean production and mass were assumed as to respond to process inefficiencies and rampant consumerism, optimizing operation costs. However, new customization and flexible productions philosophies have been gaining ground in some industries, such as the agile manufacturing. From a literature review that addresses the history of this philosophy, it is clear that agile manufacturing is not fully comprehended, with very scarce information about practical cases. The paper aims to discuss these issues. Design/methodology/approach – In this paper the authors describe an exploratory methodology approach, with three semi-structured case study interviews. The goal is to study which of agile manufacturing practices are being applied in the studied companies and what is the perceived effect that these have on operational performance. Since most of these companies develop highly customized products, the role of agility on new product development can have a huge impact on their operational performance. Findings – Agile manufacturing is not yet a widespread philosophy of managing for the companies studied, being virtually unknown as a global concept. However, it was found that many of the practices of agile manufacturing are already implemented in these companies without association with this philosophy. It was also concluded, by the finding through respondents opinions, that agile practices contribute positively to the studied companies operating performance. Originality/value – The novelty of this research derives from observation of agile manufacturing practices in SMEs. This research is useful to SMEs implementing agile manufacturing principles.