A structural equation model for analyzing the relationship between enterprise resource planning and digital supply chain management

Abstract

Digitization and the internet are new phenomena which have greatly changed the way in which modern-day businesses are run. Enterprise resource planning (ERP) is one such system developed as a result of digitization in order to improve firm supply chain efficiency. This study investigated the relationship between digital and sustainable supply chain (in this case the ERP system) and firm competences of supply chain management. 33 respondents from e-commerce firms volunteered to take part in the data collection process of the study, with a majority of them being information technology (IT) managers. The hypothesized relationships were analyzed using structural equation modelling (SEM). Findings of the study depict that all the hypothesized relationships were significant (p<.001) at the 1 % level of significance, implying that there exists a positive effect of the ERP systems on firm performance.