The linkage between supply chain integration and manufacturing improvement programmes

Abstract

Purpose: While the attention of most OM scholars has shifted to supply chain management, there is still a need to understand how supply chain strategies are linked with internal manufacturing strategies. The literature shows some studies in this field, but a deep investigation of the linkages between these two areas is still missing. The purpose of this study is to investigate on an empirical basis the relationship between two supply chain integration dimensions – the integration of information flows and the integration of physical flows – and two manufacturing improvement programmes – lean production and enterprise resource planning (ERP) systems. Design/methodology/approach: Evidence is drawn from a sample of 297 European companies from the third edition of the International Manufacturing Strategy Survey. Data are analysed using exploratory factor analysis and hierarchical regression. Findings: Results show that the adoption of the lean production model has a strong influence on the integration of both information and physical flows along the supply chain, while no significant influence emerged from the adoption of ERP. Research limitations/implications: Findings open up new research questions about the missing link between ERP and information integration along the supply chain. Further developments concern the investigation of the impact of consistent adoption of internal and external practices on performance. Practical implications: The paper provides managers with clear evidence of the need for consistency between internal and external integration. Originality/value: This paper contributes to research by providing empirical evidence of the link between manufacturing and supply chain integration practices.