An empirical study of the relationships among strategy, flexibility, and performance in the supply chain context: A path analysis approach

Supply chain flexibility has become a focus of organizations faced with the need to survive in a highly uncertain business environment. Even though there has been a significant amount of research on the topic of flexibility, most of these studies have focused on internal manufacturing systems as a single entity in a supply chain. With the advent of supply chain philosophy where other entities are involved in the business, just being flexible within the boundary of the firm is inadequate.; Drawing upon the manufacturing flexibility literature, as well as the limited research in supply chain flexibility, this thesis empirically verifies the supply chain strategy model and examines the sequential relationships among the supply chain strategy, supply chain flexibility, and supply chain performance in small- and medium-sized firms. This thesis also examined the tradeoff between flexibility types and the alignment of various supply chain flexibility dimensions with supply chain strategies. The alignment relationship between supply chain strategy and supply chain flexibility is established to enable manufacturing managers to set clear priorities in investing and developing necessary supply chain flexibility.; Using the data collected from 175 firms that were manufacturing industries in Canada, the identified constructs have been used to test a theoretical model using the path analysis technique. The study produced four main results. First, supply chain strategy types can be classified into innovative strategy, customer-oriented strategy, and follower strategy. Second, innovative strategy firms must invest time and resources in developing new product and delivery flexibility; customer-oriented strategy firms are required to invest heavily in developing sourcing, product, delivery, and information systems flexibility; and follower strategy firms need no investment in any specific type of supply chain flexibility. The third results shows that only when the tradeoff among supply chain flexibility types and alignment with supply chain strategy are considered can supply chain flexibility contribute to the improvement of supply chain performance. The final result demonstrated that manufacturers must reconsider how they use information technology (hardware and software) to enhance information systems flexibility and improve overall supply chain performance. While this study increases our understanding of supply chain flexibility, it is our hope that this study will motivate future research.