Drivers of supply chain integration and the role of organizational culture: Empirical evidence from Indonesia

Abstract

Purpose

Supply chain integration (SCI) is a set of practices driven by many factors and circumstances. The purpose of this paper is to examine firms’ internal and external drivers of SCI, evaluate the impact of the integration on firm performance, and further investigate the moderating role of organizational culture in strengthening the relationships between firms’ drivers and SCI.

Design/methodology/approach

For the purpose of this study, manufacturing firms were identified as the focal firms in supply chains, and thus data were collected through a survey of 223 Indonesian-based manufacturing firms. Two informants from each firm became the respondents. Structural equation modeling was used to analyze the data.

Findings

This study confirmed the positive relationship between SCI and firm performance. The results also indicated that internal driver, or specifically firms’ customer orientation (CO), triggered the initiation of SCI. Organizational culture, in terms of external focus, positively influenced the relationship between CO and SCI.

Research limitations/implications

This study illustrates the important role of organizational culture in determining the shape of the relationship between firms’ drivers and SCI. The results of this study enhance the understanding of SCI, especially related to types of organizational culture that could promote the integration.

Originality/value

This study brings a different dimension of SCI as this study provides evidence from a developing country, which might implement different practices as compared those of developed countries. This study provides a measure of internal drivers, which has not been empirically investigated. The new measure was tested and validated using a rigorous process, and thus could be employed in other studies with different settings.

Citation

Yunus, E.N. and Tadisina, S.K. (2016), "Drivers of supply chain integration and the role of organizational culture: Empirical evidence from Indonesia", Business Process Management Journal, Vol. 22 No. 1, pp. 89-115. https://doi.org/10.1108/BPMJ-12-2014-0127