Academic journal article Journal of Management Research

The Role of Competitiveness as Mediator for the Relation between Supply Chain Flexibility and Firm Performance

Academic journal article Journal of Management Research

The Role of Competitiveness as Mediator for the Relation between Supply Chain Flexibility and Firm Performance

Article excerpt

Abstract

The purpose of this paper is to explore the impact of supply chain flexibility on the competitiveness and firm performance and to explain the role of competitiveness as mediator for the relation between supply chain flexibility and firm performance. Methods of data collection was survey. The sample was the manager of large-scale fishery firms in the Southeast Sulawesi. Research results showed the high supply chain flexibility has a significant effect on higher competitiveness, but does not has significant effect on firm performance, there for competitiveness has significant effect on firm performance. Finally, competitiveness becomes a complete mediation relationship between supply chain flexibility on firm performance. The practical implications of this study was to provide insight and knowledge to fishery firm managers, particularly in Southeast Sulawesi and Indonesia and generally in other developing countries, in implementing the concept supply chain flexibility by observing the capability of their partners in the supply chain to respond market changes in achieving and maintaining competitiveness and firm performance. Originality of this research was to provide the basis for an integrated configuration model in testing the relationship between supply chain flexibility on competitiveness and firm performance, and also on the role of competitiveness as mediator in improving firm performance.

Keywords: Supply Chain Flexibility, Competitiveness, Performance

1. Introduction

In the era of modern business highly competitive, manufacturing climate is characterized by increasingly sophisticated consumers that demand customized products and short lead times. Many companies that have previously relied on order winning through low cost standardized production have had to become more flexible in order to compete. Authors have acknowledged the importance of flexibility in meeting customer demands and improving responsiveness. The competitors' composition of resource can be obtained in many parts of the world, so that supply chain flexibility (SCF) should receive a special focus from manufacturing companies in fishery sector so that they can improve their competitiveness and firm performance. The effort to support industrialization in fishery sector as outstanding commodity of a region should be given a priority to the improvement of competitiveness and added-value, which is affected among others by improving supply chain and value chain management. So far, the distribution of fish from production centers to various regions is not optimal, while the stability of fish supply is necessary for the consumption and processing industry. Therefore, the central government has planned to develop a national fish logistics system to facilitate the distribution of fish from regions and to serve as the initial step in improving the fish supply chains.

The synergy between the central government, regional government, the private business and wide public is the key to the success for the effort to improve product competitiveness and performance of fishery companies. The development of fishery company performance in Southeast Sulawesi up to 2011 is only 73.88%, equivalent to a decrease of 10.20% compared to 2010. The factors influencing this decrease in fishery companies performance are: (1) less than conducive competition among fishery companies; (2) rationalization of business sector which result in the reduction of production and kinds of processed fish; (3) inability to continue operation for two companies due to financial problems; (4) four state-owned fishery companies are merged due to worsening liquidity (CSA, 2011).

This would be determined by the firm capability in building effective relations in an integrated manner among its business partners. A company's success is determined not only by the company's own performance but also by the performance of the whole network (Haizer & Render, 2010). With the proliferation of product varieties and the increased volatility of the global marketplace, uncertainty is now an important feature of the contemporary business environment. …

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