The concept of integration has received considerable attention in operations and supply chain management literature in a time spanning over two decades. To advance theory development, it is important to critically examine the empirical findings in various integration studies. In a recently published paper my co-author and I undertake an extensive investigation of the relationships between supply chain integration and various performance dimensions using a metaanalytical methodology. The study contributes to literature in four important ways. First, the findings empirically show that internal integration, supplier integration, and customer integration have significant impact on a firm's financial performance. Second, the study examines the impact of internal integration, supplier integration, and customer integration on a firm's operational performance; and its underlying dimensions of cost, quality, delivery, and flexibility separately. Third, the study points out the specific relationships between supply chain integration and performance that need to be further examined within contingency framework to discern the role of moderating factors. Finally, to provide direction for managerial decision-making, the study offers insights regarding integration dimension(s) that have largest breadth and depth of impact on various performance measures.
The study provides some insights for practitioners that are engaged in managing operations within their organizations as well as in the extended supply chain. Firms typically have limited resources and managers need to allocate these resources prudently to obtain maximum possible benefits. Supply chain integration requires monetary investments to set up the necessary infrastructure. This study provides some guidance for managers so that they can make decisions regarding integration investments based on the chosen competitive priorities. The investments allocated for integration could be targeted towards, and prioritized upon, the relevant dimensions of supply chain integration depending on the desired performance outcomes. Internal integration should generally precede external integration since it is important for the processes within an organization to be aligned before engaging in information sharing and collaboration activities with external supply chain partners. Managers should consider this sequence when they are making supply chain integration related decisions if the depth of impact is considered. Additionally, we find that supplier integration has the maximum breadth of impact (83.33%) followed by customer integration (66.67%) and customer integration (66.67%).
Moreover, managers should be aware of the contextual differences in the relationship between supply chain integration and performance. The findings of this study lend support to certain moderating effects that might be strengthening or weakening the relationships between supply chain integration and performance. The context should be carefully analyzed and studied before making potentially expensive and hard-to-reverse investments in integration. For instance, environmental uncertainty stands out as a critical issue to be considered when it comes to supply chain integration. Information processing becomes more crucial in highly uncertain environments relative to others, and managers should be cognizant of the requirements of the business environment they operate in when they are making supply chain integration decisions to align the degree of coordination internally as well as externally. In essence, managers should supplement their bandwagon-driven or benchmarking-driven integration initiatives with prudent consideration of their own contextual environments.
Source: Ataseven, C. and Nair, A., 2017. Assessment of supply chain integration and performance relationships: A meta-analytic investigation of the literature. International Journal of Production Economics, 185, pp. 252-265.