Effect of Supply Chain Management Practices on Financial and Economic Sustainable Performance of Indonesian SMEs

Christina Whidya Utami · Hendro Susanto · Fanny Septina · Yoseva Maria Pujirahayu Sumaji · Ikbar Pratama

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Quality and Supply Management Supply Chain and Inventory Management Sustainable Supply Chain Management

Abstract

In contemporary business environment firms focus on sustainable Financial and Economic performance. Sustainable performance of the firms happens is the result of continuous value generation for shareholders and stakeholders of firm. This study intended to investigate the effect of Supply Chain Management Practices (SCMP) on Financial and Economic Sustainable Performance of Indonesian SMEs. For the achievement of the objective of study, researcher used quantitative research approach and questioner method was applied for the collection of data. To fulfil the objectives of this study, the data was collected from the managing directors, supply chain managers, planning managers, and procurement managers. PLS-SEM approach was carried out by the study for the examination hypotheses. The results of study concluded that SCM Practices have significant and positive influence on Financial and Economic Sustainable Performance of Indonesian SMEs. Moreover, findings of this study indicated that effective application of SCMP could enhance the financial and economic performance of the SMEs in developing countries. Findings of the study highlighted that the relationship with customer, strategic supplier integration and level of information sharing is necessary for financial and economic sustainable performance of SMEs. This study contributes to Supply chain literature and offer new empirical evidence that supply chain management practices are significant for sustainable financial performance. However, this study used only three SCM practices (relationship with customer, strategic supplier integration and level of information sharing), the other important aspects of SCM practices such as SCM formulation, implementation and evaluation would be used in future research.

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References

1993Research methods for business: A skill building approach 2004Towards a theory of supply chain management: the constructs and measurements 2004The impact of supply chain management practices on competitive advantage and organizational performance 2011Supply chain integration and performance: The effects of long-term relationships, information technology and sharing, and logistics integration 2011Using fuzzy DEMATEL to evaluate the green supply chain management practices 2012Environmental orientation and corporate performance: The mediation mechanism of green supply chain management and moderating effect of competitive intensity 1994Logistics & Supply Chain Management 2007Relationship between supply chain performance and degree of linkage among supplier, internal integration, and customer

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