Supply Chain Management
The Relationship Between Supply Chain Strategy and Supply Chain Performance: An Empirical Investigation Using Structural Equation Modeling

Article Details
Pub. Date : Dec, 2019
Product Name : The IUP Journal of Supply Chain Management
Product Type : Article
Product Code : IJSCM21912
Author Name : Amit Chandak, Neeraj Kumar and A Dalpati
Availability : YES
Subject/Domain : Strategic
Download Format : PDF Format
No. of Pages : 11



Supply Chain Management (SCM) practices play a vital role in enhancing the overall performance of any organization. The firms try to achieve strategic competitiveness through implementation of appropriate SCM practices, thereby taking their performance to the next level. SCM has now turned out to be one of the fastest growing and key areas in management, as a result of which it has successfully grabbed the attention of top management in respective organizations. This paper examines the relationship between Supply Chain Strategy (SCS) and Supply Chain Performance (SCP) for automobile industry in India, especially Small and Medium Enterprises (SMEs). The association is examined through statistical methods such as Pearson correlation coefficient and Structural Equation Modeling (SEM). The results reveal that SCS has a significant correlation with SCP. Especially SCS parameters such as Innovative Strategy (INS), Customer-Oriented Strategy (COS) and Agile Supply Chain Strategy (ASCS) have a high correlation with SCP [i.e., Cost Performance (CP), Logistic Performance (LP) and Quality Performance (QP)]. The SEM results also show that SCS parameters appear to be of primary importance and exhibit the importance of SCP. The result underlines the importance of SCP to the automotive industry in India.


With the implementation of Goods and Services Tax (GST) and the focus on e-vehicles, automobile companies are facing tremendous opportunities and challenges. The rapid technological advancement, innovation and automation have created a lot of challenges for this sector. These challenges offer automobile industries an opportunity to gain competitive advantage by effectively managing their supply chain. Companies are now following a customer-oriented approach with the assistance of respective suppliers in their business. They need to focus on enhancing Supply Chain Management (SCM) activities from raw material purchase to the final product delivered to the end user.

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