Mediating and non-linear relationships among supply chain integration dimensions

Abstract

Purpose The purpose of this paper is to analyse the relationships between the different dimensions of supply chain integration (SCI). First, the sequence in which these dimensions should be implemented and some possible mediating effects are investigated. Then, relationships are examined more closely to observe whether they present more complex non-linear forms than those usually analysed. Design/methodology/approach Required information was gathered from a sample of 477 Spanish industrial companies (23.4 per cent response rate). PLS structural equation modelling was applied to capture non-linear relationships between SCI dimensions. Findings The results indicate that internal integration leads to external integration and that within external integration, information flow integration provides the basis for financial flow integration and physical flow integration. Thus, the results suggest the existence of a logical sequence to achieve SCI. In addition, clearly different non-linear relationships are observed between the analysed variables. Practical implications It seems that a sufficient minimum value has to be reached for internal integration to have a positive effect on external information and financial integration. In addition, a higher degree of information integration appears to facilitate financial and physical integration, although a medium degree of information integration results in a lower degree of financial integration. Therefore, managers should not expect that efforts made to increase one integration dimension will always produce the same effect on the other dimensions. Originality/value An empirical contribution is made to knowledge of the logical SCI sequence. This contribution is not only important for academia, but also for managers seeking to improve supply chain performance through integration.