Supply chain interactions and time‐related performances

Many studies claim that when an organization interacts with suppliers and with customers across the supply chain, the organization would achieve improved time performances. This claim, however, has undergone limited theoretical development, as well as subsequent systematic empirical testing. As a result, we still have incomplete understanding of the “why” (i.e. the rationale) and the “how” (i.e. the mechanisms by which) of such interaction’s impact on time performances. This study addresses these issues through both model development and empirical analyses of 164 plants. Our analyses suggest two findings. First, when an organization interacts with suppliers and with customers on quality management issues, the organization would improve its time performances indirectly as a result of complete mediation by internal practices for: quality management; low management; inter‐unit coordination; and vertical coordination. On the other hand, when an organization interacts with suppliers and with customers on materials flow management issues, the impact on time‐related performances can either be completely or partially mediated by internal practices.