The antecedents of supply chain performance : a case of KwaZulu-Natal province, South Africa

Abstract

Over the past years, there has been a growing significance in supply chain management (SCM) as a vehicle through which many companies/firms can reach a competitive advantage. Despite the importance of supply chain within today’s economy, little is known about how SCM mechanisms can contribute to firm performance. The main purpose of this study was to evince the influence of trust on supplier development, knowledge creation and supply chain performance (SCP) in KwaZulu-Natal (KZN) Province, South Africa (SA). It was a cross-sectional study that was conducted with different samples and several variables. This is a quantitative study which used a probability and non-probability approach. The study was conducted using both the simple random technique and convenience sampling. Descriptive analysis was performed using the IBM SPSS 25 software package. A sample size of 495 respondents was used in this study. In total, 310 questionnaires were received from all respondents who participated in this study. Results specified that trust does not have any direct impact on SCP. However, based on the beta coefficient values, trust predicts better knowledge creation than supplier development. The empirical results show that an organisation/firm that has a high level of knowledge creation with its suppliers will yield greater performance within its supply chain (SC). As the supply chain performance enabled process was empirically defined, firms are therefore able to design appropriate collaborative strategies for their SC. Thus, the capability to integrate external knowledge from different sectors could be a major factor in firms’ improvement capacity. This study recommends that the South African Government must provide training for firm owners and easy funding access for SMEs in KZN to be able to confront competition from local and foreign competitors. Furthermore, this study suggests that staff development and training for public and private sector institutions as well as individual career management enhancement initiatives must be implemented. Collaboration with suppliers and other supply chain associates is strongly recommended, which should increase the chance to gain strengths, trust, knowledge creation, information sharing and technological proficiencies.