The linkages between leadership approaches and coordination effectiveness

Abstract

Purpose – A suitable leadership approach and multiple dimensions of performance (operational and social dimensions contributing to financial performance – the effectiveness of international agri-food supply chain coordination) are important because of significant linkages between them. However, there has been no such empirical research to explore the linkages in five selected New Zealand-UK international agri-food supply chains (dairy, meat, vegetables and fruits). Therefore, the purpose of this paper is to address this knowledge gap. Design/methodology/approach – Before applying covariance-based structural equation modelling (a path analysis) on the data collected from 112 chain coordinators (CCs) (chief executive officers, managing directors and head of departments) of the selected agri-food supply chains, a comprehensive process of exploratory factor analysis, reliability and validity tests is used to develop the constructs. Findings – The findings suggest that CCs’ participative leadership approach is highly significantly (β=0.60; p=0.00) associated with the effectiveness of international agri-food supply chain coordination. Directive leadership does not have a significant relationship and its interaction effect with participative leadership resulted in a significant negative relationship with the effectiveness of agri-food supply chain coordination. Moreover, social (satisfaction with and trust in supply chain partners) and operational (service and product quality) dimensions are the major determinants of financial performance (profit, sales and market share) with β=0.44 (p=0.00) and β=0.44 (p=0.05), respectively. These variables jointly explain 70 per cent of the variance in financial performance, and leadership explains 36 per cent of the variance in coordination effectiveness. Practical implications – In order to understand the multiple dimensions of performance and their linkages, the study enhances the understanding of CCs and contributes to determine the best practices for modern agri-food supply chains. Originality/value – This study is the first step in developing and confirming complicated linkages with the specific characteristics of selected international agri-food supply chains. As a result, the empirical evidence also clarifies the earlier ambiguous results on the topic raised from other industries or countries.