Academic journal article Journal of Supply Chain Management

Exploring the Relationship between Efficient Supply Chain Management and Firm Innovation: An Archival Search and Analysis

Academic journal article Journal of Supply Chain Management

Exploring the Relationship between Efficient Supply Chain Management and Firm Innovation: An Archival Search and Analysis

Article excerpt

INTRODUCTION

Researchers in the area of operations and supply chain management have often highlighted the importance of multiple research methods for furthering knowledge (Fisher 2007; Craighead and Meredith 2008). In line with the objectives of this special issue and the call for using multiple methods in operations management investigations to triangulate academic evidence (Boyer and Swink 2008) and strengthen the empirical research base in operations (Fisher 2007), this study illustrates the use of secondary data which can complement theoretical research that uses primary data (e.g., Frohlich and Westbrook 2001; Thun 2010). To serve as an illustrative application, the association between efficient supply chain management and innovation performance is investigated in this research using secondary data.

Both innovation and efficient supply chain management provide firms with avenues to gain competitive advantage. The research literature confirms that the development of new, innovative products is a key source of competitive advantage (Droge, Vickery and Markland 1994; Brown and Eisenhardt 1995). Many have alluded to the compelling operational and financial benefits which can accrue to firms from efficient and effective supply chain management (Fisher 1997; Vickery, Calantone and Droge 1999). Efficiency is a core concept for operations and supply chain management that influences success. However, studies on the organizational determinants of innovation have shown that slack, not efficiency, can have a positive influence on innovation (e.g., Nohria and Gulati 1996). A focus on efficiency in supply chain management views slack as a sign of waste, an inefficiency that detracts from the firm's value. This represents a potential paradox and raises a question: What is the relationship between efficient supply chain management and a firm's innovation output--i.e., does a focus on efficiency in supply chain management reduce innovation output?

Using secondary data to investigate the above question, this research adds to the literature in multiple ways. First, it serves as an additional example of a broader set of tools available for operations and supply chain management research. Second, it demonstrates how the use of secondary data provides a longitudinal perspective to the existing literature in supply chain management, complementing cross-sectional evidence (e.g., Frohlich and Westbrook 2001; Thun 2010). Finally, existing supply chain management literature provides evidence that supply chain management influences firm performance primarily on the operational and financial performance metrics of organizations (e.g., Vickery, Jayaram, Droge and Calantone 2003; McKone-Sweet and Lee 2009; Lao, Hong and Rao 2010). This research adds to that literature by illustrating how secondary data can be utilized to investigate the relationship of efficient supply chain management with innovation performance of organizations.

Secondary data research needs to start with a conceptual framework of the variables and relationships of interest. The following section presents a framework conceptualizing efficient supply chain management, the firm's innovation and the relationship between them. Next, it is critical to identify appropriate data sources, to develop operational measures, which are supported theoretically and choose appropriate analysis techniques. The research methodology, analysis and results are discussed in the methodology section. Finally, secondary data often provides proxy measures and one must be cognizant of its limitations in the context of the research question. The final section presents the limitations and conclusion.

CONCEPTUAL FRAMEWORK

Efficient Supply Chain Management

A central facet of supply chain management is the efficient flow of materials within the organization and across the firm's boundaries (Lee, Padamanabhan and Wang 1997; Frohlich and Westbrook 2001; Billington 2010). …

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