Impact of Internal Integration, Supply Chain Partnership, Supply Chain Agility, and Supply Chain Resilience on Sustainable Advantage

Abstract

The global order has suddenly changed due to the COVID-19 pandemic. Many countries, including Indonesia, have applied lockdown policies to stop the spread of COVID-19. Lockdown policies have disrupted the supply of raw materials and the demand for finished goods. The manufacturing industry is one of the sectors that has suffered most in this situation, and they have struggled to reconfigure their internal and external supply chain network and partnership. This study examined the impact of internal integration, supply chain partnership, supply chain agility, and supply chain resilience on sustainable advantage. The participants of this study were from manufacturing companies in Indonesia. For data collection, a questionnaire was used, with a five-point Likert scale to obtain the respondents’ opinions. Using Google Form link, the questionnaire was distributed via email and the WhatsApp social media application to the predetermined set of manufacturing companies. Respondents filled out 672 questionnaires, and 456 respondents (corresponding to 67.86%) filled it out correctly and were considered valid for further analysis. Partial least squares (PLS) regression was used to analyze the data using the SmartPLS software version 3.3. The results supported all nine hypotheses proposed. Internal integration through interdepartmental data sharing affects supply chain (SC) partnerships, SC agility, and SC resilience. Moreover, SC partnerships, through the on-time delivery of materials and by coping with changing demand, improve SC agility, SC resilience, and sustainable advantages. SC agility, in keeping the production process running normally and regulating the production capacity, affects SC resilience and sustainable advantage. SC resilience improves sustainable advantage by providing timely product delivery and reliable sales volumes in pandemic conditions. These results provide insights for managers into enhancing the sustainable advantage by improving supply chain agility, supply chain resilience, and supply chain partnerships. This study could contribute and extend the acceptance of previous studies in the context of the manufacturing industry.