Supply chain alignment for improved business performance: an empirical study

Abstract

Purpose – This study aims to explain how supply chain alignment, which remains a major challenge for supply chains, can be achieved and its implications for business performance (BP) by testing the strengths of the relationships between previously identified enablers, supply chain alignment and BP. Design/methodology/approach – A literature review develops hypotheses on the relationships between enablers, alignment and BP. A survey of medium-to-large UK manufacturing companies was conducted where the sample comprised 151 randomly selected companies, and the response rate was 56 per cent. Partial least square regression was used to test the hypothesis. Findings – Two types of supply chain alignment are defined – shareholder and customer – but only customer alignment (CA) has a direct positive impact on BP, while shareholder alignment (SA) is its antecedent. Top management support was shown to be an enabler of both shareholder and CA, while organisation structure, information sharing and performance measurement system enabled SA, while internal relational behaviour enabled CA. Research limitations/implications – Supply chain management research lacks knowledge on exactly how supply chain alignment can be achieved and what BP implications it has. This research provides a tested conceptual model to address this gap. Practical implications – The refined conceptual model provides precise guidance to practitioners on how to improve BP through supply chain alignment. Originality/value – Whilst the strategic management literature emphasizes the importance of SA, this study reveals another crucial alignment – CA – and shows its direct positive impact on BP.