An empirical investigation of the impact of strategic sourcing and flexibility on firm's supply chain agility

Abstract

This is the submitted version of the paper.This version of the publication may differ from the final published version. Purpose -The objective of this study is to investigate two potentially key drivers of a firm's supply chain agility, namely strategic sourcing and firm's strategic flexibility. Despite some theoretical and conceptual works suggesting that some elements of these two constructs may relate to agility, this has not yet been assessed together empirically. This study aims to address this gap in the literature. Permanent repository linkDesign/Methodology/approach -This study involves an empirical investigation of a theorybased model based on the competence-capability framework, and a dynamic capabilities theoretical perspective, where the internal competencies of strategic sourcing and firm's strategic flexibility relate to the dynamic capability of the firm's supply chain agility. This investigation also includes the testing of a possible mediation effect of firm's strategic flexibility on the relationship between strategic sourcing and the firm's supply chain agility. The model is tested utilizing data from 144 U.S. manufacturing firms via partial least square (PLS) methodology.Findings -The results of the empirical study indicated that both strategic sourcing and firm's strategic flexibility were significantly related to the firm's supply chain agility. In addition, while a full mediation effect was not found on the part of strategic flexibility, there was evidence for partial mediation.Research limitations/implications -Given that the data is from specific U.S. industries, the generalizability of current findings to other industries or countries may require additional investigation.Originality/value -Given the attention paid to agility in terms of its importance to responding to business uncertainty, and more recently, as an important capability in managing supply chain disruption risks, this paper investigates how strategic sourcing and flexibility can contribute to agility.

Development of a risk-oriented strategic sourcing (ROSS) framework for the construction and electronics manufacturing industries

“…Therefore, the alignment with corporate goals and cross-functioning is still an important factor that the sourcing function needs to adapt to (Moses and Åhlström, 2008). Furthermore, the supplier management and partnerships, continuous improvement, employees, supply flexibility and total cost of ownership (Narasimhan and Das, 1999;Kocabasoglu and Suresh, 2006;Su et al, 2009;Chiang et al, 2012) were identified as significant factors and are mainly in line with previous research, although these were only mentioned by around half of the companies.…”

“…Furthermore, Chiang et al (2012) show that strategic sourcing and strategic flexibility are significant influences on the agility of supply chains. The determination of strategic sourcing by strategic purchasing, supplier development, internal integration and information sharing has a greater influence on a firm's supply chain agility than flexibility.…”

“…The mitigation of volatility can be achieved through improved planning/forecasting, collaboration and information exchange (Hallikas et al, 2004;Khan and Pillania, 2008), and the electronic exchange is recommended (Saeed et al, 2005). Finally, the application of supplier relationship management is supported (Khan and Pillania, 2008;Chiang et al, 2012), and the companies need to consider and identify their lock-in position and planning problems.…”

“…The question is no longer whether to outsource a capability or activity but rather how to source every single activity in the value chain." Furthermore, the importance is supported by the added value to the company produced by the impact on competitive advantage, business performance and supply chain agility (Narasimhan and Das, 1999;Chiang et al, 2012) …”

Strategic sourcing supplier selection misalignment with critical success factors: Findings from multiple case studies in Germany and the United Kingdom

“…Although many scholars see the need of strategic sourcing and its positive impact on organisations' performance and competitive advantage (Kocabasoglu and Suresh, 2006;Chiang et al, 2012), this research reveals that strategic sourcing is still an emerging function within the both electronics manufacturing and construction organisations in Germany and the UK. This study also finds that the adoption of strategic sourcing in the UK organisations is more than in Germany, and the practices of strategic sourcing in the construction organisations is less than that in the electronics manufacturing organisations.…”