Re-examining the effects of supplier integration on operations performance: a relational view

Purpose - The importance of supplier integration (SI) in improving firms’ performance has been previously identified but the effects of SI are complicated, as the relationship between supplier and buyer is full of uncertainty. The purpose of this paper is to re-examine the effects of SI on operations performance from a relational view.

Design/methodology/approach - Two strategies of integrating suppliers are theoretically presented: information sharing and joint decision making. Hypotheses are then developed on when SI influences operations performance, using product complexity and competitive intensity as moderating factors. The hypotheses are tested using a global survey data set, made up of 763 manufacturing firms from 22 countries.

Findings - The results indicate a positive relationship between SI and operations performance and that the moderating roles of product complexity and competition intensity are significant, but product complexity does not have significant moderation effects on the relationships between joint decision making and product quality/cost reduction.

Research limitations/implications - The moderators of product complexity and competitive intensity are not comprehensive. Future study into how and under what circumstances SI has the greatest effect will be of benefit.

Originality/value - This study makes theoretical contributions by exploring the strategies of SI through a relational view, and examining the effects of SI through the moderating roles of product complexity and competition intensity.