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The relationship between supply environment, supply chain integration and operational performance: The role of business process in curbing opportunistic behaviour

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  • Wong, Wai Peng
  • Sinnandavar, Chandra Mohan
  • Soh, Keng-Lin

Abstract

The opportunistic behavior of parties in the supply chain leads to resource wastages. Information asymmetry and the opportunistic behavior of transacting parties in supply chains squanders the intended benefits of supply chain integration (SCI). Literature suggests that reducing information asymmetry between transacting organizations will curb their opportunistic behavior. This study investigates the SCI between the hauliers and the container depots. The hauliers provide the transportation of containers for the shippers and consignees to and from the depots. Transaction Cost Economics (TCE) underpins the conceptual framework. The supply environment which embodies transaction cost economics attributes is expected to affect SCI and SCI is expected to affect operational efficiency and subsequently environmental performance. Business process is anticipated to moderate the impact of SCI on operational efficiency by reducing information asymmetry and curbing opportunistic behavior. Responses from 84 haulier companies were analyzed using partial least squares, structural equation modeling. Results indicate strong support for almost all transaction cost economics propositions. However, transaction cost economics suggests that transaction attributes have a linear relationship with SCI, though findings from this study indicate that it could be curvilinear. Results confirm that strengthening of business process between hauliers and depots could strengthen the SCI positive impact on hauliers' performance and subsequently their environmental performance. Stronger SCI can reduce cost and increase revenue and at the same time, reduce the greenhouse-gas emissions of the hauliers. Findings support that economic gains and environmental protection can be complementary and can be attained by curbing the opportunistic behavior of organizations in supply chains.

Suggested Citation

  • Wong, Wai Peng & Sinnandavar, Chandra Mohan & Soh, Keng-Lin, 2021. "The relationship between supply environment, supply chain integration and operational performance: The role of business process in curbing opportunistic behaviour," International Journal of Production Economics, Elsevier, vol. 232(C).
    • Handle: RePEc:eee:proeco:v:232:y:2021:i:c:s0925527320303169
    DOI: 10.1016/j.ijpe.2020.107966
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    8. Wenjie Li & Muhammad Yaseen Bhutto & Idrees Waris & Tianyang Hu, 2023. "The Nexus between Environmental Corporate Social Responsibility, Green Intellectual Capital and Green Innovation towards Business Sustainability: An Empirical Analysis of Chinese Automobile Manufactur," IJERPH, MDPI, vol. 20(3), pages 1-20, January.

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