Reconfigurability for higher supply chain performance

Abstract

Nowadays, supply chains (SC) are subject to high variability due to the instability and uncertainty of the markets. Market turbulence requires a higher connection and an accelerated reconfiguration of their productive capacities, which implies changes and cost-effectiveness in response to demand change. Therefore, this paper explores the role of the reconfigurability of the Supply Chain (REC) as a driver of Supply Chain performance (SCP). This deductive research aims to evaluate the effect of each reconfigurability dimension on SCP and analyze which sectors show higher manufacturing reconfigurability processes levels. We hypothesize that there is a positive and significant relationship between the REC and SCP. Using the hierarchical regression analysis on a sample of 309 manufacturing plants, we find that some reconfigurability dimensions explain at least 15% of SC performance. At the time, we find some companies prefer to improve the reconfigurability dimension that directly impacts manufacturing cost than the dimension that requires restructuring machinery and layout to diminish lead time due to the high-cost, time, interface, and other issues required.