The impact of the relationship commitment and customer integration on supply chain performance

Abstract

Purpose This study aims to show how to improve supply chain performance through the relationship between firms and their customers. In doing so, this study examines the impact of a firm’s relationship commitment and customer integration on supply chain performance. The aim is to detail a way to increase supply chain performance through the relationship between companies and their customers.

Design/methodology/approach The empirical analysis was based on a survey on 205 corporate-Egypt multi-industry businesses including manufacturing, retailing, wholesaling and shipping services firms. Data collection was through a questionnaire survey distributed to 1,264 senior managers with responsibilities in the field of supply chain, logistics, purchasing, marketing and operations and with a 16% response rate. A conceptual model was designed, and hypotheses were analysed with covariance-based structural equation modelling.

Findings This study makes a significant contribution to the supply chain management (SCM) literature by examining the influence of firms’ relationship commitment on supply chain performance in the supply chain management context by means of the disaggregation of customer integration into two dimensions: integration with customer (IWC) and integration by customer (IBC). The findings indicate that firms’ relationship commitment does not relate directly to supply chain performance, but rather indirectly through integration both with and by customers.

Research limitations/implications This paper outlines a conceptual model in which firms’ relationship commitment relates indirectly to supply chain performance. The model also sheds light on the fact that IWCs precedes IBCs in supply chains. This finding suggests that firms should focus on customer integration to improve supply chain performance.

Practical implications This study offers a particularly refined understanding of the reasons behind and situations in which supply chain integration (SCI) enables firms to gain superior supply chain performance. In fact, firms focusing on customer integration may improve their supply chain performance, thus enhancing the value of the supply chain.

Originality/value This study contributes to the literature by considering a relational view of the SCI-Performance path. In particular, by disaggregating customer integration into IWCs and IBCs, this paper verifies customer integration acting as a mediator between relationship commitment and supply chain performance in supply chains.