Supplier integration and company performance: A configurational view

Supplier integration is considered a key managerial strategy for improving buyer performance. This study adopts a configurational approach to supplier integration, based on the interaction and complementarity between supply chain management practices. In this perspective, this study explores the impact of supplier integration and measures aimed at creating a fast supply network structure on buyer performance. This research also attempts to ascertain whether these practices can exert a synergic effect. After examining data from a sample of 186 manufacturing plants, we can conclude that while taken singly supplier integration and fast supply network structure practices have a markedly positive effect on the performance goals considered (i.e., efficiency, schedule attainment and flexibility); in addition, they interact to produce an additional synergic effect on efficiency and schedule attainment. The analyses also reveal that investing in FSNS or SI initiatives alone can be risky. On one hand, when companies fail to make any effort to structure their supply network in order to achieve fast lead times, the impact of supplier integration on efficiency and schedule attainment may be hindered and, in extreme cases, supplier integration might even have no impact at all. On the other hand, investing only in fast supply network structure initiatives, without striving to achieve an adequate level of supplier integration might well be useless: indeed, even detrimental to any improvement in performance. These findings provide useful guidelines for managers who must decide how to combine supplier integration and fast supply network structure initiatives in order to improve or maximize performance.

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► This study adopts a configurational view of supplier integration.
► It examines the impact of supplier integration and fast supply network structure practices on buyer’s performance.
► It analyzes the synergic effect between supplier integration and fast supply network structure practices.
► When companies invest to reduce lead times and integrate with suppliers, the positive impact on performance is amplified.
► The decision of not investing in one of these practices can hinder the positive impact of the other.