Market Orientation and Supply Chain Performance, Mediating Role of Supply Chain Management Strategy: An Empirical Analysis

Market Orientation and Supply Chain Performance, Mediating Role of Supply Chain Management Strategy: An Empirical Analysis

Pulidindi Venu Gopal (VIT University, India) and Aswini Priya (VIT University, India)
DOI: 10.4018/978-1-5225-5424-0.ch010

Abstract

The aim of this study is to examine the supply chain performance of small medium enterprises (SMEs) in Vellore district. This research also determines the connection between market orientation and supply chain performance and the mediating effect of supply chain management strategy on the impact of market orientation on supply chain performance. The survey was administered and collected from employees and sales managers from three small medium enterprises (SMEs) in Vellore district. Correlation, regression, mediation effect using SPSS is performed to test the hypothesis. The findings of the study reveal that there exists a positive relationship between marketing orientation and supply chain performance and the manufacturing organization's supply chain management strategy mediates the connection between marketing orientation and supply chain performance.
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Introduction

The accomplishment of an organisation is dependent on the successful supply chain which it takes parts as a partner (Zelbst, Green Jr, Sower, & Reyes, 2009). The term supply chain management plays a very vital role in organisation where it found to be combination of key business processes done among a system of suppliers, manufacturers, customers and retailers in order to ameliorate the stream of goods and services and provides information from suppliers to customers in order to mitigate system wide costs while sustaining service levels (Christopher 1998; Simchi-Levi, Kaminsky, & Simchi-Levi 2000; New & Payne 1995). According to Morgan (1997) termed integrated supply chain management as the alignment of buyers, suppliers, and customers and their processes to achieve an advanced form of competitive advantage. In the 21st century, supply chain management is viewed as principal future trend which is more significant for the purpose of purchasing and providing management professionals (Carter & Narasimhan, 1996). It is now the trend for most of the organization espousing supply chain management philosophy as a way of gaining competitive advantage. Competitive advantage in SCM context is entwined i.e. cost mitigation and revenue enhancement. Domestic supply chains involve international suppliers and customers and mastery of SCM which is now an input to competitive advantage. As far as today’s economy is concerned, the problem faced by most of the organizations to gain competitive advantage is by ameliorating supply chain performance. The contemporary firms started to pay more attention towards a shift in competition i.e. shift from competition between firms to competition between whole supply chains due to inability of the firms to compete with their suppliers (Ntayi, Gerrit, & Eyaa, 2009; Hult, Ketchen, & Arrfelt, 2007). Supply chain performance pays more attention by enabling supply chain to meet the needs of the customers which in turn benefits the organisation (Zelbst, Green Jr, Sower, & Baker, 2010). Supply chain performance is likely to collapse if they met with the failure and therefore it is terminated out of the market (Eyaa & Ntayi, 2010). This critical scenario enforces the firms to give more consideration to supply chain management capability through ameliorating or maintaining competitiveness.

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