Assessing the Impact of Supply Chain Integration on Firm Competitive Capability

Firms undertake efforts to compete along multiple fronts. First, they integrate internally in order to prepare a cohesive organizational response and to ready the ground for external integration. They then seek to integrate with both customers and suppliers which can increase the breadth and depth of resource endowments. Internal and external integration are posited to improve manufacturing related competitive capability. This study examines whether internal integration and external integration impact manufacturing related competitive capability. The findings indicate significant positive effects of internal integration on both supplier and customer integration. Each supply chain integration dimension has a significant direct effect on competitive capability. Testing for mediation effects indicates that customer integration and supplier integration partially mediate the effects of internal integration on competitive capability.