Supply chain integration and its impact on firm performance

Abstract

newline In today s competitive world, the success of any firm depends on its ability to manage and integrate its intricate network of relationships with its suppliers and customers. Increased globalization, rapidly changing technology, shorter product life cycles, a focus on efficiency and increasing customer expectations are some of the main factors that are driving higher levels of integration and closer relationships between supply chain partners. The most successful manufacturers are those who have carefully linked their internal processes to external suppliers and customers in unique supply chains. In short, for the new millennium upstream and downstream integration with suppliers and customers has emerged as an important element of manufacturing strategy. newlineA literature review of the research studies related to supply chain integration (SCI) and firm performance was performed for this study. From the review of literature, it was inferred that the relationship between supply chain integration and financial performance are mediated though some immediate performance outcomes such as customer service or manufacturing capabilities. This study considers three dimensions of supply chain integration viz. supplier integration, customer integration and internal integration and argues that these dimensions would lead to different immediate performance outcomes.