Examining the Effect of Supply Chain Management Practices and Supply Chain Integration on Firm Operational Performance: A Practice-Based View Perspective

ABSTRACT

Operational performance is a major concern for the manufacturing industry of any country, especially a developing country like Pakistan. Despite its fertile land for raw cotton, agriculture based economy and low laboure cost, Pakistan still performs poorly in textile and apparel exports. Underpinned by the Theory of Practice Base View (PBV), this studys primary objective was to enhance the operational performance (OP) of textile industry of Pakistan with the following antecedents: lean manufacturing (LM), process innovation (PI), and supply chain integration (SCI). Due to unexpectedly weak or inconsistent findings, the study also analyzed the mediating role of SCI in the effects LM, and PI on, OP. The study used a positivist, deductive approach with a quantitative methodology and a cross-sectional time horizon. A questionnaire-based survey was used to collect data from textile mills of Pakistan. The study received 113 responses, out of which 110 were kept for further analysis. Partial Least Squares Structural Equation Modelling (PLS-SEM) was used to test the hypothesis. The studys findings supported three out of the five proposed hypotheses which included the mediating impact of SCI with the R2 value of 0.891 and Q2 value of 0.443 with direct relation also R2=0.593 and Q2=0.251 through mediation respectively. Specifically, the effect of LM on OP is not significant, whereas this relationship is supported when there is SCI and shows full mediation between LM and OP and partial mediation between PI and OP. This study contributes to the body of knowledge by extending the existing literature on PBV and textile firms operational performance in the context of a developing country like Pakistan. The findings suggest that the top-level management should effectively implement the practices to enhance operational performance. Supply chain integration also plays a pivotal role in translating these practices into tangible outcomes for textile firms in Pakistan. So, managers also should focus on integration as a facilitator of performance improvements.

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