Supply chain integration: a European survey

Abstract

Purpose: The major goal of this study was to identify the underlying factors of supply chain integration in European firms with particular emphasis on the role of information sharing and interorganizational collaboration. Design/methodology/approach: In order to get an overall view of the state of supply chain integration in European firms, a mail survey was done to investigate the extent and nature of supply chain integration in 149 companies. Using statistical analysis, the study attempts to comprehend if increasing levels of the intensity of supply chain integration show concomitant rise of operational performance. Findings: European firms are starting to be aware of the strategic importance of integration across the boundaries of the supply chain. Both correlation analyses and multiple regression analyses have clearly shown that supply chain integration affects operational performance and the degree of integration also influences cost and efficiency. An interesting and surprising finding from our survey was the significant negative correlation between the length of relationship with suppliers and performance measures such as total logistics costs, on‐time delivery and rate of return. While performance has been shown to have improved as a result of collaboration with suppliers and customers alike in areas such as supply chain design, inventory management and customer relationship management (CRM), the nature and extent of integration has been rather selective. Most companies are quite cautious when it comes to sharing sensitive data and rightfully so. Research limitations/implications: In order to obtain more generalizable results, further larger studies of supply chain integration are needed to reveal the impediments for a wider degree of integration and to highlight potential strategies to increase integration across the supply chain. Practical implications: The main findings confirm that comprehensive supply chain integration is more a rhetoric than reality in most European firms. However, we found a clear indication of the value placed by the respondents on integration with key suppliers and customers for performance enhancement. Originality/value: This is the first empirical work measuring the state of supply chain integration in European firms and the challenges faced by them. Supply chain management professionals would have a clearer idea about the areas ripe for collaborative effort.